- The Washington Times - Monday, October 2, 2006


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

Laurence Siegel, 53, retired under a deal reached with Mills Saturday, but he will remain the nonexecutive chairman of the company’s board of directors.

Former Mills chief financial officer Mark Ordan was appointed CEO of the company, which has been seeking a buyer.

The Mills Corp. is headquartered in Chevy Chase.

Mr. Siegel, who had served as CEO at Mills since 1995, will receive a $2.5 million severance payment, according to a filing yesterday with the Securities and Exchange Commission. If the company is bought before the end of 2007, Mr. Siegel will receive a further $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 LLC 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,” Mr. Ordan said.

Mr. Siegel’s departure comes after Mills in August removed its president, Mark Ettenger.

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

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

The NYSE told the company it would re-evaluate the extension decision at the end of October, around the time that Mills now says it will file the late reports.

Mills recently has shed assets in preparation for a possible takeover of all or part of the company. It sold three overseas malls in August, then received a $500 million investment in the Meadowlands Xanadu from Colony Capital that reduced Mills’ stake in the project.

Earlier this year, Mills obtained a $2 billion loan from investment firm Goldman Sachs to help it stay afloat as it seeks a buyer. The loan is due at the end of the year.

The company said it is in talks with potential buyers. Mr. Ordan said yesterday that he looks forward “to leading the Mills as we pursue the sale of all or part of the company.”

Share of Mills fell 23 cents, or 1.4 percent, to close at $16.48 yesterday. A year ago, Mills traded at around $55 per share.

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