A little more than two weeks after being named to the board of directors of
Adelphia Communications Corp., Leonard Tow and Scott Schneider have
resigned.
Tow -- who fought for weeks to gain three seats on Adelphia's board as part
of an agreement reached in 1999, when he sold his Century Communications Corp.
to Adelphia for $5.2 billion in stock and assumed debt -- resigned Monday,
citing unreliable financial information at the company.
He is the largest individual shareholder of Adelphia stock outside of the
Rigas family, and he owns about 12 percent of the company's outstanding shares
through various personal and family partnerships.
After weeks of angling to get his board seats -- he finally settled for two
-- Tow and Schneider, vice chairman of Citizens Communications Corp., were named
to Adelphia's board May 24. Tow is chairman of Citizens.
In a letter to Adelphia's board of directors dated June 10, Tow said he and
Schneider joined the board with the intention of restoring Adelphia's
credibility and stabilizing it financially.
'However, subsequent revelations of the unreliability of corporate data, as
well as the ongoing serial disclosures of wrongdoing, have made it impossible to
contribute meaningfully to the process,' Tow wrote. 'Accordingly, Scott
Schneider and I herewith tender our resignations from the board effective
immediately.'
Adelphia filed an 8-K with the Securities and Exchange Commission Monday
morning stating that it would reduce cash-flow and revenue results for 2000 and
2001 to correct accounting irregularities.
In his letter, Tow said he reserves his rights as a shareholder of
Adelphia.
Adelphia stock was trading at 23 cents per share in midday trading Monday.
The stock has lost 98.9 percent of its value since March 27, when the company
first revealed $2.3 billion in off-balance-sheet debt. That debt is now at about
$3.1 billion.
