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The Times 100: The Best Performing Companies in California

Kenetech : No. 1 on Falling Behind

May 07, 1996|PATRICK LEE

Kenetech, the world's largest maker of wind turbines--the futuristic machines that generate power from wind--has fallen on hard times, and its stock along with it.

In 1994, the company was riding high. But reports of problems with its principal product, a high-tech turbine, and falling earnings caused its stock to fall.

At the same time, moves to deregulate the electric utility industry, including a ruling by the Federal Energy Regulatory Commission, relieved the utilities of the burden of buying power at above-market rates from alternative energy producers such as wind.

At the end of 1995, several managers, including Chief Executive Gerald R. Anderson, resigned. Richard Saunders, brought in as Anderson's replacement to turn the company around, resigned only three months later.

Now, speculation is that the firm may file for bankruptcy protection. One sign: General Counsel Mark Lerdal was named the firm's new chief executive.

Meanwhile, the company seems to be bailing water to stay afloat. This month, it said it would cut 100 jobs and sell assets after seeing a $250.1 million loss in 1995.

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