RESTON, Va. – Student loan giant Sallie Mae reported its long-time chief executive Albert Lord, who has been serving as chairman of the board since May 2005, has agreed to return to run the ailing company as CEO.
The return of Lord comes as the nation’s largest provider of student loans is fighting over a private equity-led group over its decision to walk away from an acquisition of the company, and as the company’s stock price has plummeted from over $56 a share to $28. The company has filed suit in Delaware Chancery Court to enforce a $900 million break-up fee on the private equity group, led by J.C. Flowers. Bank of America and JP Morgan Chase, after the group terminated its $29 billion takeover of the student loan giant.
Sallie Mae also said that Lord, who was in line to earn more than $230 million from the scotched $60-a-share takeover, sold 1.2 million of his Sallie Mae shares, about 10% of his holdings, to satisfy margin requirements.
Sallie Mae reported a third quarter loss of $344 million, compared to a profit of $263 million for the third quarter in 2006.
