Hutchings forced to quit Tomkins

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Greg Hutchings, the chief executive of Tomkins, was yesterday forced to resign from the conglomerate he founded 17 years ago after an investigation into his behaviour uncovered evidence of "corporate excesses".

Greg Hutchings, the chief executive of Tomkins, was yesterday forced to resign from the conglomerate he founded 17 years ago after an investigation into his behaviour uncovered evidence of "corporate excesses".

His departure coincided with the launch of a strategic review of Tomkins that could result in the break-up of an empire spanning Jacuzzis, handguns, car parts and air-training services.

David Newlands, the non-executive chairman, has taken over temporarily as executive chairman. He has extended his investigation to the rest of the board to reassure investors no other directors are "tainted".

Mr Newlands said: "Greg has resigned because he is tired after a year of increasing pressure on him and because the board has lost confidence in his ability to lead the company." Severance terms for Mr Hutchings, who earned £1.4m last year, have not been agreed.

The allegations against Mr Hutchings range from personal use of Tomkins' four executive jets and two London apartments to putting his wife and housekeeper on the company payroll.

Tomkins' auditors, Arthur Andersen, called in last week to conduct the inquiry, are also examining hundreds of charitable donations made by the group. Among those being scrutinised are ones to the London Forum, which supported Lord Archer's candidature for mayor of London; and United Response, a charity run by a friend of Mr Hutchings, Su Sayer, which received £40,000.

Mr Newlands said the allegations against Mr Hutchings were "substantially correct"."Clearly there have been corporate excesses and the highest standards of corporate governance have not been adhered to. My job is to ensure those excesses stop."

Supporters of Mr Hutchings said none of his behaviour had been "covert" and Mr Newlands appeared to accept this, saying his activities had been approved within the company, though not at board level.

Mr Newlands said he could not rule out further board departures. "I want to make sure that none of my current colleagues are tainted in any way and that all the holes have been plugged. We have to look at the board and decide whether we have the right mix of executives and non-executives". He said so far he had seen no evidence to implicate other directors. "This is a situation which appears to be restricted to the top."

It is thought likely that Ali Wambold, a managing director of Lazards, will be replaced as senior independent director and chairman of Tomkins' remuneration committee. Arthur Andersen has been asked to have a report ready for Tomkins' next board meeting next month. The strategic review is expected to take up to six months to finish.

Mr Hutchings was not available for comment yesterday. A close friend said: "Just remember, Greg didn't start out as chief executive of a FTSE 100 company; he built it up from nothing and on the way did very well. He made some mistakes but most of the allegations against him are way out of date or exaggerated. Let's not get too holier than thou about this. The share price is what has really caused his departure."

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