International Rectifier CEO resigns at company's request

By Colleen Taylor, Contributing Editor -- Electronic News, 10/3/2007

As the company commits itself to righting its recently discovered accounting-related wrongs, on Tuesday Alex Lidow ended a month-long paid leave of absence with an immediately effective resignation of his positions as CEO and a director of International Rectifier Corp. (IR).

Lidow's departure from the El Segundo, Calif.-based power management technology company brings an end to nearly 40 years of his professional involvement with the company that was founded in 1947 by his father, Eric Lidow. In an interview earlier this year, Alex Lidow told Electronic News that he began working at IR at the age of 16 during his summer vacations. He has been CEO of IR since 1995.

As of today, Eric Lidow has remained in his spot as the chairman of IR's board.

The troubles that led to Lidow's resignation first became public in April, when IR announced that an internal investigation had discovered "accounting irregularities" at a then-unnamed foreign subsidiary. According to company filings to the Security and Exchange Commission (SEC), the investigation has since discovered that the faulty sales figures were the result of unsubstantiated orders being entered at IR's Japan subsidiary, which resulted in the shipment of products and the recording of sales with "no obligation by customers to receive and pay for the products."

The resignation follows several weeks of paid leave he took starting in August. In a statement made yesterday, IR said that Don Dancer will continue to serve as International Rectifier's acting CEO until a permanent replacement is found. According to an SEC filing IR made late Tuesday, Lidow's resignation comes "at the company's request," although his agreement to leave "does not constitute an admission or acknowledgment by any party of any unlawful or improper act or conduct, all of which is expressly denied."

Indeed, in the statement made Tuesday IR did not imply that Lidow is leaving on bad terms. "We want to thank Alex for his contributions to the company," acting CEO Don Dancer said. "His focus on power management helped to solidify International Rectifier as a leader in the industry."

"I have appreciated the opportunity to serve International Rectifier as a Director and CEO the last 12 years," Lidow added in the statement.

IR said that Lidow will receive accrued salary, bonus and vacation through the date of his departure. According to filings made to the SEC, Lidow received total compensation of more than $1.2 million in 2006.

Meanwhile, IR also said Tuesday it has initiated steps to ensure that it does not suffer from another accounting debacle. Among the actions, IR said it has "changed reporting relationships" at the company's Japan subsidiary to improve oversight of the subsidiary and added interim processes to "help assure adherence to proper revenue recognition policies" at the Japan subsidiary.