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Top Exec of Mall Developer Retires

Laurence Siegel steps down amid an SEC probe of Mills Corp.'s accounting practices.

October 03, 2006|From the Associated Press

Mall developer Mills Corp., under investigation for accounting problems, said Monday that its longtime chief executive retired over the weekend, becoming the second high-ranking executive to leave in recent months.

Laurence Siegel retired under a deal reached with Mills on Saturday but will remain nonexecutive chairman of the company's board of directors.

Former Mills Chief Financial Officer Mark Ordan was appointed CEO of the Chevy Chase, Md.-based company, which has been seeking a buyer.

Siegel, who had served as CEO at Mills since 1995, will receive a $2.5-million severance payment, according to a filing Monday with the Securities and Exchange Commission. If the company is bought before the end of 2007, Siegel will receive an additional $10.5 million.

He also will continue to work as a consultant on a recently announced deal with Kan Am USA Management XXII and Colony Capital Acquisitions to fund one of Mills' troubled projects: the $2-billion Meadowlands Xanadu mall and entertainment complex in northern New Jersey.

"Larry's vision and energy have helped Mills build a unique portfolio of assets, and everyone at the company is pleased that we will benefit from his continued involvement on the board of directors," Ordan said in a statement.

Siegel's departure comes after Mills in August removed its president, Mark Ettenger, from his post.

The SEC is investigating the company's accounting practices, probing areas such as lease accounting and cost capitalization. Mills has not yet filed its 2005 annual report or first- and second-quarter earnings reports for 2006 with the federal agency. The accounting problems are expected to reduce stockholder equity by $263 million to $283 million.

The company said in Monday's SEC filing that it had received an extension from the New York Stock Exchange until Jan. 2 to file its overdue annual report. Mills had risked delisting if it did not file by the end of September.

Shares of Mills fell 23 cents to $16.48 on Monday. A year ago, Mills traded at about $55 a share.

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