Tyco's Kozlowski faces inquiry into Manhattan apartment costs
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Your support makes all the difference.Tyco International, the troubled Bermuda-based conglomerate, was embroiled in fresh controversy yesterday as it opened an internal inquiry to investigate claims that Dennis Kozlowski, its former chairman and chief executive, used company money to pay for the upkeep of his chic Manhattan apartment.
Tyco also began to sell off assets yesterday in an attempt to restore the debt-laden group to health. It raised $135m in cash by selling its spinal implant business Surgical Dynamics to the American orthopaedic devices maker Stryker. Analysts expect it to make more disposals to reduce borrowings.
Sources close to the company claimed Mr Kozlowski – who resigned earlier this week amid allegations of tax evasion linked with his purchase of six paintings by artists including Renoir and Monet – improperly used Tyco funds to pay personal bills at the Fifth Avenue property he bought for $18.5m two years ago.
Tyco is also investigating allegations Mr Kozlowski spent at least $2m of the company's cash to buy other works of art for the apartment and suggestions other Tyco employees were involved in the tax-dodging scheme.
Mr Kozlowski, dubbed "the most aggressive CEO" by Business Week, denies any wrongdoing. Tyco said it would publish the findings of its investigation as quickly as possible.
Mr Kozlowski, 55, has pleaded innocent to charges laid by Manhattan district attorney Robert Morgenthau that the former Tyco boss avoided $1m in New York state sales tax on paintings he bought for $13m. He was released on bail on Tuesday and will return to court on 26 June.
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