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                                                                    EXHIBIT 99.1
 
                             THE ENSTAR GROUP, INC.
                PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995
                        SAFE HARBOR COMPLIANCE STATEMENT
                         FOR FORWARD-LOOKING STATEMENTS
 
     In passing the Private Securities Litigation Reform Act of 1995 (the
"Reform Act"), 15 U.S.C.A. Section 77z-2 and 78u-5 (Supp. 1996), Congress
encouraged public companies to make "forward-looking statements" by creating a
safe harbor to protect companies from securities law liability in connection
with forward-looking statements. The Enstar Group, Inc. ("Enstar" or the
"Company") intends to qualify both its written and oral forward-looking
statements for protection under the Reform Act and any other similar safe harbor
provisions.
 
     "Forward-looking statements" are defined by the Reform Act. Generally,
forward-looking statements include expressed expectations of future events and
the assumptions on which the expressed expectations are based. All
forward-looking statements are inherently uncertain as they are based on various
expectations and assumptions concerning future events and they are subject to
numerous known and unknown risks and uncertainties which could cause actual
events or results to differ materially from those projected. Due to those
uncertainties and risks, the investment community is urged not to place undue
reliance on written or oral forward-looking statements of Enstar. The Company
undertakes no obligation to update or revise this Safe Harbor Compliance
Statement for Forward-Looking Statements (the "Safe Harbor Statement") to
reflect future developments. In addition, Enstar undertakes no obligation to
update or revise forward-looking statements to reflect changed assumptions, the
occurrence of unanticipated events or changes to future operating results over
time.
 
     Enstar provides the following risk factor disclosure in connection with its
continuing effort to qualify its written and oral forward-looking statements for
the safe harbor protection of the Reform Act and any other similar safe harbor
provisions. Important factors currently known to management that could cause
actual results to differ materially from those in forward-looking statements
include the following:
 
NO RECENT OPERATING HISTORY; BLIND POOL INVESTMENT
 
     During 1997, the Company completed its reorganization. Accordingly, the
Company does not have any significant operating history upon which an evaluation
of the Company or its prospects can be based. At present, the Company is a
"blind pool;" no acquisitions have as yet been identified by the Company. The
acquisitions to be made by the Company will be selected by the executive
officers and Board of Directors of the Company and may in certain circumstances
be made without shareholder approval. Thus, the Company's prospects must be
considered in light of the risks, expenses and difficulties frequently
encountered by companies in their beginning stages of development.
 
UNCERTAINTY OF ACQUISITION TARGET; COMPETITION FOR SUITABLE ACQUISITIONS
 
     The Company has not yet identified an acquisition target or focused on a
particular industry or geographical market for such acquisition. Accordingly,
there can be no assurance that the Company will be successful in acquiring an
operating business that will bring value to the Company's shareholders.
Moreover, the business of the acquisition target may be subject to numerous
risks that are impossible to predict in this Annual Report. By way of example
only, the acquisition target may be subject to government regulation, or
dependent upon new technology or new product development. In sum, there can be
no assurance that the Company will make an acquisition that will prove
financially advantageous to the Company's shareholders. In the event the Company
fails to acquire an operating business within a reasonable period of time, the
Company will consider other alternatives, including, but not limited to,
liquidation of the Company.
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     The Company faces intense competition in its search for one or more
operating businesses. In this regard, the Company competes with strategic
buyers, financial buyers and others who are looking to acquire suitable
operating businesses, many of whom have greater financial resources than the
Company or have greater flexibility in structuring acquisition transactions or
strategic relationships.
 
SUBSTANTIAL CHANGE IN THE NATURE OF THE COMPANY'S BUSINESS
 
     The Company's long term viability, profitability and growth will depend on
its ability to successfully realize the plans of the Company's management and
Board of Directors. The magnitude of the changes in the Company that have
occurred since its emergence from bankruptcy make it difficult to evaluate its
future prospects on the basis of historical information relating to the Company.
In addition, significant challenges are often encountered in attempting to build
a business upon emerging from bankruptcy.
 
DEPENDENCE ON NIMROD T. FRAZER AND OTHER EXECUTIVE OFFICERS AND DIRECTORS
 
     The success of the Company is highly dependent on the ability of Nimrod T.
Frazer, the Company's Chairman, President and Chief Executive Officer, and the
other executive officers and directors of the Company to identify a financially
advantageous acquisition target and to consummate a transaction for the purchase
of such target on favorable terms. The identification of attractive business
opportunities is difficult and involves a high degree of uncertainty. There can
be no assurance that the Company's Board of Directors and management will be
successful in identifying an attractive business opportunity or consummating a
successful transaction.
 
POSSIBLE VOLATILITY OF STOCK PRICE
 
     There may be significant volatility in the market price for the Company's
common stock. Quarterly operating results of the Company, changes in the value
of the Company's assets, changes in general conditions in the economy, the
financial markets, adverse press or news announcements, or other developments
affecting the Company, could cause the market price of its Common Stock to
fluctuate substantially. In addition, in recent years, the stock market has
experienced significant price and volume fluctuations. This volatility has
affected the market prices of securities issued by many companies for reasons
unrelated to their operating performance.
 
VOLATILITY OF FIRST UNION COMMON STOCK
 
     Substantially all of the Company's assets currently are comprised of shares
of common stock of First Union Corporation ("First Union Common Stock"). The
market price for such stock will fluctuate, and there can be no assurance that
such fluctuations will not be severe. To the extent that First Union Common
Stock were to decline in value, the Company's financial ability to make an
acquisition would be diminished. The Company does not have any representatives
on First Union's board of directors and does not have any knowledge concerning
the business of First Union that is not publicly available.
 
GENERAL ECONOMIC RISKS AND BUSINESS CYCLES
 
     The climate for making a suitable acquisition is affected generally by the
prevailing economic conditions and the business cycle. There can be no assurance
that the economic conditions or status of the business cycle will be favorable.
 
RISK OF NO DIVERSIFICATION
 
     The Company does not plan to acquire operating businesses in a sufficient
number of industries such that the Company's holdings will be diversified across
several industries. In fact, the Company may decide to acquire only one business
operating in one industry.
 
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FINANCING LIMITATIONS
 
     The Company may be outbid by another company with respect to any given
acquisition that management of the Company identifies as in the best interests
of the Company. Moreover, there may be certain financing contingencies that will
restrict the ability of the Company to make a given acquisition.
 
INVESTMENT COMPANY ACT OF 1940
 
     If the Company were to continue to hold the shares of First Union Common
Stock as its primary asset for a period of time longer than the twelve months
ending March 27, 1998, the Company may be required to register as an investment
company under the Investment Company Act of 1940 (the "1940 Act"). Registration
under the 1940 Act would subject the Company to many constraints not incurred by
most operating companies. The Company anticipates that registration will not be
necessary, because the Company plans to acquire an operating business. If the
Company were required to register as an investment company under the 1940 Act,
registration could have material adverse consequences on the Company's
operations. In order to provide the management of the Company with the optimal
amount of time to evaluate potential acquisitions, the Company filed for an
extension of the one-year exemption from registration requirements of the 1940
Act. The Company is seeking an extension of up to two years, but there can be no
assurance that it will be granted. The 1940 Act imposes, among other things,
significant restrictions and requirements on an investment company's capital
structure, the composition and duties of its board of directors, the custody of
its assets, the declaration of dividends, and transactions with its affiliated
persons.
 
ANTITAKEOVER PROVISIONS
 
     The Company's Articles of Incorporation and Bylaws contain provisions that
may discourage other persons from attempting to acquire control of the Company,
including, without limitation, procedural requirements in connection with
shareholder nominations for election of directors. The Company has also elected
to be subject to certain provisions of the Georgia Business Corporation Code and
has adopted a share purchase rights plan. In certain circumstances, the fact
that provisions and agreements are in place which inhibit or discourage takeover
attempts may affect the market price of the Company's common stock.
 
TAX CONSIDERATIONS
 
     In September 1996, pursuant to the expedited procedures of Section 505 of
the Bankruptcy Code, the IRS entered a consent order with the bankruptcy court
waiving its right to challenge the Company's federal income tax return for the
taxable year ended August 31, 1995. The consent order effectively confirmed the
validity of the Company's use of its net operating loss carryforwards ("NOLs")
to offset its taxable income for the taxable year ended August 31, 1995.
However, because there are possible applications of certain provisions of the
Tax Code that may limit the Company's use of the NOLs in future tax returns,
there can be no assurance that the Company will be able to utilize its NOLs
fully in subsequent taxable years.
 
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