Lay resigns as Enron chief
HOUSTON, Texas (CNN) -- Enron Corp. Chairman Kenneth Lay resigned late Wednesday, more than a month after the onetime high-flying energy company became the largest corporate bankruptcy case in U.S. history.
"I want to see Enron survive, and for that to happen, we need someone at the helm who can focus 100 percent of his efforts on reorganizing the company and preserving value for our creditors and hard-working employees," he said in a written statement.
"Unfortunately, with the multiple inquiries and investigations that currently require much of my time, it is becoming increasingly difficult to concentrate fully on what is most important to Enron's stakeholders."
Lay will remain on Enron's board, but will step down as the company's CEO, the company announced. The move came after talks with the company's creditor's committee, Lay said.
Enron, a once an energy giant, filed for bankruptcy in December. Before its sudden collapse, it was ranked the seventh-largest U.S. company in terms of revenue.
In October, Enron was forced to disclose that it had concealed more than $500 million in debt from related partnerships led by company executives. Its stock, which once traded at nearly $90 a share, sank to less than $1 before it was delisted earlier this month.
The company's collapse has sparked a Justice Department probe and numerous congressional investigations. The company and its employees have been the single biggest group of contributors to President Bush and other Republican campaigns, and have donated to many Democratic lawmakers as well.
Enron's executives and directors sold about $1.3 billion worth of stock in the last three years, with Lay making a $119 million, according to a Thomson Financial study commissioned by CNN. Its auditor, accounting giant Arthur Andersen, admitted its employees shredded documents relating to Enron audits in the days after Enron's problems became public.
Arthur Andersen CEO Joseph Berardino conceded Sunday that his company made errors but said that Enron's demise ultimately was the result of a failed business model, not shady accounting.
A former Enron executive said Monday that employees at the company's headquarters in Houston, Texas, were shredding documents as late as January 14, in spite of the company's December bankruptcy filing that costs thousands of investors and employees their life savings. Security guards were posted in the building Wednesday to prevent further shredding.
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