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EDITIONS
Wednesday, 25 September, 2002, 15:46 GMT 16:46 UK
New Tyco boss rallies the troops
Former Tyco chief executive Dennis Kozlowski
Dennis Kozlowski's shadow hangs over Tyco
Edward Breen, the successor to disgraced Tyco International chief executive Dennis Kozlowski, has told jittery investors that his firm is still a good bet.


I believe the steps we have taken in the last two months are putting us on the right road

Tyco chief executive Edward Breen
Mr Breen said he expected Tyco's sales for the three months to September to match the $9.1bn (5.7bn) it notched up during the April-to-June quarter.

"Let me reiterate that Tyco's fundamentals remain positive," he said in his first address as chief executive to shareholders and analysts.

Mr Breen added that an accounting review had found no fresh irregularities at Tyco, and said the firm would have a new financing plan in place in time for debt repayments which fall due in February.

New broom

"I believe the steps we have taken in the last two months are putting us on the right road," he said.

Mr Breen took over as head of Tyco in July, shortly after Mr Kozlowski stepped down amid reports that he was being investigated for tax evasion.

Mr Kozlowski is now facing charges that he helped to steal more than $170m from Tyco, and could be given a prison sentence of up to 25 years if found guilty.

He is also alleged to have forgiven unapproved personal loans to some Tyco employees.

Shares bounce

The affair has unnerved investors already concerned over Tyco's shaky financial structure after a decade of rapid acquisition-led growth.

Shareholders are particularly worried that the firm could soon be forced to start accounting for a $27bn decline in the value of its acquisitions relative to what it paid for them.

Mr Breen admitted that the company's profits for the current three-month period would fall short of its previous estimate of 45-47 cents a share.

But investors reacted positively, marking Tyco shares 89 cents higher to $14.48 in early trade in New York.

The company's stock is still down 70% from the beginning of the year.


Politics of regulation

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FORUM
See also:

19 Sep 02 | Business
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