Dynegy CEO Resigns Amid Bogus Trade Controversy

wildbirdhunter

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Tuesday, May 28, 2002
   

HOUSTON — Dynegy Inc. (DYN) said Tuesday that Chairman and Chief Executive Chuck Watson has resigned amid controversy over sham trades with CMS Energy Corp. (CMS) -- whose own CEO quit for the same reason four days ago.


CMS, a utility holding company, admitted earlier this month to $4.4 billion of "round-trip" power trades -- buying and selling power at the same price with the same counterparty to artificially pump up revenue and volume -- over 18 months.

Two Dynegy board members on a temporary basis will replace Watson, who had been with the company for 17 years. Glenn Tilton, ChevronTexaco Corp.'s vice chairman, will fill in as chairman, while Dan Dienstbier of Northern Natural Gas will become interim chief executive.

Dynegy said it plans to conduct a search to fill the chairman and chief executive positions.

Steve Bergstrom will remain Dynegy's president and chief operating officer.

Disclosure of the trades have been the latest blow to a power sector already hit hard by the collapse of Enron Corp. , once the nation's largest trader of power and gas.

Federal regulators are investigating the deals.

Shares of Dynegy closed Friday New York Stock Exchange trading at $9.30, down 84 percent from a high of $59.88 set in September 2000.
 
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