John Rigas' decision to step down as chairman of Adelphia Communications
Corp. will have little effect on a dissident shareholder's attempt to wrestle
control of the company from the Rigas family.
On Monday, Citizens Communications chairman Leonard Tow announced that he is
exercising his right to name three new members to Adelphia's board of directors
-- himself, Citizens vice chairman Scott Schneider and Citizens president and
chief operating officer Rudy Graf.
In a conference call with analysts Wednesday discussing Citizens'
first-quarter results, Schneider said Rigas' resignation changes nothing.
'Mr. Rigas' resignation does nothing to resolve the conflicts of interest
between Adelphia's board and the company's shareholders,' Schneider said on the
call. 'Mr. Rigas is retaining his seat on the company's board, and the board is
still controlled by the Rigas family. In our view, the conflicts still exist,
which are a clear obstruction to the company moving forward.'
Schneider also expressed concern with the lack of information Adelphia has
provided to shareholders.
'Our goal remains to restore Adelphia's credibility, to participate in the
stabilization of the company financially and to maximize the value of our
investment,' Schneider said.
Tow sold his Century Communications Corp. to Adelphia in 1999 for about $5.2
billion in Adelphia stock and assumed debt. Tow, his wife, Claire, and various
family trusts own about 12 percent of Adelphia's outstanding shares.
Since the end of March, Tow's holdings in Adelphia have lost 70 percent of
their value.
