Advertisement

Archive for Wednesday, October 15, 2003

Westar CEO seeks to keep Wittig-era directors

October 15, 2003

Advertisement

— James Haines says following David Wittig makes being chief executive officer at Westar Energy Inc. more difficult, but he praises three Wittig-era directors and says he wants them to remain on the company's board.

Haines recently said the company's plans to reduce debt and shed nonutility assets are on schedule.

Haines became CEO in December, a month after Wittig resigned to defend himself against federal bank fraud charges. Wittig was convicted of those charges, and a sentencing hearing for him is scheduled for Monday in U.S. District Court.

The company's problems -- a low stock price, a debt that peaked at $3.9 billion and, according to an internal investigation completed this past spring, misconduct on the part of Wittig -- caused some consumer advocates and attorneys involved in regulatory proceedings to question the vigilance of Westar's board.

Haines said following Wittig makes the CEO's job harder "because of problems that have to be fixed" at Westar, which is the largest electric utility in Kansas with 640,000 customers .

"And I've had to spend a lot of energy in the last year taking care of those problems, and we're going to be spending time in the next year taking care of those problems," Haines said.

From November through May, Wittig and three other directors left the Westar board, leaving only three Wittig-era directors on the seven-member board. They are board Chairman Charles Q. Chandler IV, a Wichita banker; R.A. Edwards, a Hutchinson banker, and John Nettels, an Overland Park attorney who once was Wittig's college roommate.

Haines said Chandler, Edwards and Nettels led the company into an investigation that resulted in May in a report charging that Wittig and former Chief Strategic Officer Douglas T. Lake, who has been on administrative leave since December, abused their positions, sought to enrich themselves, tried to stifle dissent and misused corporate aircraft.

Haines said the three directors also had been instrumental in getting the company to abandon a diversification strategy adopted by Wittig.

Critics say that strategy led to enormous losses, particularly in the security alarm business.

"There's no question about their fitness to be on the board. I want them to be on the board," Haines said of Chandler, Edwards and Nettels.

Commenting has been disabled for this item.