Cendant Fires Top Exec After Stock Plummets 46%
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Cendant Coroporation, formed on December 17, 1997 by the merger of HFS Corporation and CUC International, reported yesterday it unearthed "accounting irregularities" in former CUC business units, news that led to the company's share price being cut in half.
Cendant dropped $16.56 on Thursday to close at $19.06 on the New York Stock Exchange, effectively reducing the combined value of the company's stock by around $15 billion.
The stunning news was followed this morning by an announcement in which the company said it had terminated the employment of executive vice president Cosmo Corigliano who was executive VP and chief financial officer of CUC before the merger.
Direct marketing leader Cendant has made several forays into the Internet marketplace through CUC International. The company operates over 50 Web sites that support its existing real estate, travel, and entertainment discounts membership businesses.
As reported on InternetNews.com in March, Cendant claimed it was making $90 million per month in Web sales from 60,000 transactions.
A series of class action suits have been filed in the last 24 hours on behalf of those who purchased common stock of CUC, Cendant, and HFS, alleging the defendants engaged in an illegal scheme to inflate the price of CUC/Cendant's stock price.