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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
 
     The Company filed for protection under Chapter 11 of the United States
Bankruptcy Code on May 31, 1991 and operated as a reorganized debtor pursuant to
its Second Amended Plan of Reorganization, as modified until July 17, 1997 when
the United States Bankruptcy Court for the Middle District of Alabama closed the
Company's Chapter 11 proceedings by final order.
 
     Because the Company just completed its reorganization in 1997, the Company
does not have any significant operating history on which to base its performance
or its prospects. The executive officers and Board will select acquisitions for
the Company. For certain acquisitions no shareholder approval will be necessary.
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 entered into a definitive agreement with respect to a
specific acquisition target or focused on a particular industry or geographical
market. 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. The business of the acquisition target may be subject to numerous,
unpredictable risks. 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. The Company competes with strategic and financial buyers
and others looking to acquire suitable operating businesses, who have greater
financial resources and greater flexibility in structuring acquisition
transactions or strategic relationships than the Company.
 
SUBSTANTIAL CHANGE IN THE NATURE OF THE COMPANY'S BUSINESS
 
     The Company's long term viability, profitability and growth 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 and consummate
an acquisition 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 successfully
consummating a transaction.
 
     One of the Company's current directors, J Christopher Flowers, entered into
an Investment Agreement with the Company, dated as of October 20, 1998 (the
"Investment Agreement"). The Investment Agreement provides that the Company will
sell to Mr. Flowers 1,158,860 newly issued shares of the Company's common stock
in exchange for a $15,000,000 full recourse promissory note from Mr. Flowers. It
also contemplated that Mr. Flowers will become Vice Chairman of the Company's
Board of Directors effective December 1, 1998. The Company believes that as Vice
Chairman, Mr. Flowers extensive business and financial acumen will enable him to
play an enhanced role in the Company's search for an operating company. The
transactions contemplated by the Investment Agreement are subject to a
shareholder approval at a special meeting expected to be held on December 17,
1998. There can be no assurance that the Investment Agreement will be approved
by the shareholders at the special meeting.
 
POSSIBLE VOLATILITY OF STOCK PRICE
 
     The market price for the Company's common stock may fluctuate substantially
due to the following factors:
 
     - announcements with respect to an acquisition;
 
     - changes in the value of the Company's assets;
 
     - quarterly operating results of the Company;
 
     - changes in general conditions in the economy;
 
     - the financial markets; and
 
     - adverse press or news announcements.
 
     In addition, recently 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.
 
INVESTMENT COMPANY ACT OF 1940
 
     As a result of holding 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 have been required to register as an investment
company under the Investment Company Act of 1940 (the "1940 Act"). Registration
under the
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1940 Act would subject the Company to many constraints not incurred by most
operating companies. On March 19, 1998, the Company filed an application with
the Securities Exchange Commission (the "SEC") requesting a two year exemption
from registration under the 1940 Act. In April 1998, the Company received
initial comments on the original application from the staff of the SEC and filed
an amended application on May 22, 1998. While the amended application was still
pending, the Company liquidated all of its First Union common stock and is
holding the proceeds in cash and cash equivalents. Accordingly, the Company
believes that its status as an inadvertent investment company has been
effectively resolved. In the event the Company fails to acquire an operating
business and again holds securities as its primary asset, then it may be
required to register under the 1940 Act. If the Company were required to
register under the 1940 Act, registration could have material adverse
consequences on the Company's operations. 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.
 
GENERAL ECONOMIC RISKS AND BUSINESS CYCLES
 
     Acquisitions are affected by the current 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 diversify across several industries. In fact,
the Company may decide to acquire only one business operating in one industry.
 
FINANCING LIMITATIONS
 
     The Company may be outbid by another company with respect to any given
acquisition and there may be certain financing contingencies that will restrict
the ability of the Company to make a given acquisition.
 
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.
One such provision involves 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. The market price of the Company's
common stock may be affected by the forgoing provisions and agreements which
inhibit or discourage take-over attempts.
 
TAX CONSIDERATIONS
 
     The Company has claimed deductions for net operating loss carryforwards
("NOLs") of approximately $8,400,000 on its federal income tax return for its
taxable year ended August 31, 1997, and anticipates claiming deductions for NOLs
of approximately $37,000,000 on its federal income tax return for the taxable
year ended August 31, 1998. The Company anticipates that after the use of its
NOLs on its federal income tax return for the taxable year ended August 31,
1998, it will have remaining NOLs of approximately $50,000,000 that may be
deductible in future taxable years (subject to applicable limitations under the
Internal Revenue Code). Although the Company believes that it is entitled to the
deductions for NOLs that it has claimed or intends to claim on its federal
income tax returns for the taxable years ended August 31, 1997 and August 31,
1998, there can be no assurance that the Internal Revenue Service will not
challenge the Company's position or as to the result of any such challenge.
Further, there can be no assurance that the Company will be able to deduct the
remainder of its NOLs for federal income tax purposes in future taxable years.
 
     This Safe Harbor Statement supersedes the Safe Harbor Statement filed as
Exhibit 99.1 to the Company's Annual Report on Form 10-K/A-1, for the year ended
December 31, 1997.
 
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