Paul Norris, who presided over W.R. Grace & Co.'s move from Florida to Maryland and steered it into bankruptcy protection in the face of thousands of asbestos injury lawsuits, will step down as chief executive of the Columbia-based maker of chemicals and building materials in May, the company announced yesterday.
Nov. 20Paul Norris, who presided over W.R. Grace & Co.'s move from Florida to Maryland and steered it into bankruptcy
protection in the face of thousands of asbestos injury lawsuits, will step down as chief executive of the Columbia-based
maker of chemicals and building materials in May, the company announced yesterday.
He will be replaced by Fred Festa, 45, who joined Grace last year as president and chief operating officer. Norris will
remain on the board of directors as non-executive chairman, focusing on the company's continuing bankruptcy reorganization.
The Columbia-based chemical company, which employs 1,200 in Maryland, filed a reorganization plan last Saturday that seeks to
limit its liability in more than 325,000 asbestos lawsuits to a maximum $1.61 billion. The company, which sold asbestos-
containing fire-protection products before 1973, is one of dozens that have filed for bankruptcy protection after being sued
by people who contracted cancer or other lung ailments after inhaling asbestos fibers.
"I believe that this is the appropriate time to complete the transition of responsibilities from me to Fred that we started a
year ago," Norris said in a statement released after the close of markets. "The businesses are in very good shape, our plan
of reorganization is before the bankruptcy court, and Fred has done a great job as chief operating officer building
credibility with all of our stakeholders."
The company declined to make either Festa or Norris available for interviews. The company's shares closed unchanged at $12.80
per share in trading yesterday.
The lawsuits and the financial burden they brought cast a shadow over Norris' roughly six years as chief executive.
Norris, 57, joined the company in 1998 after leaving AlliedSignal Inc., where he served as senior vice president of the
company's $1.6 billion chemicals business. His youth and experience were seen as a signal that Grace was ready to grow its
specialty chemical business after having spun off more than 30 businesses in the late 1990s.
Struggling to cope with potentially billions of dollars in asbestos liabilities, Norris took the company into bankruptcy in
2001. The move was widely anticipated after Owens Corning, Armstrong World Industries Inc., Babcock & Wilcox and several
other companies facing asbestos claims entered bankruptcy.
Grace filed its reorganization plan after numerous delays during which the company continued to negotiate with creditors. In
it the company said it would set up a trust to pay asbestos claims. The company also laid out its plans to deal with $1.2
billion in bank debt, environmental liabilities, trade payables, pension claims and tax liabilities.
Festa was previously a partner with Morgenthaler Private Equity. He remains an outside director of Formed Fiber Technologies,
in which Morgenthaler is a principal shareholder, the company said. Prior to Morgenthaler, he served as president and chief
executive of ICG Commerce and held management positions with AlliedSignal.
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