J. Peter Grace Jr., the legendary 81-year-old chairman of W. R. Grace & Co., was forced to resign Friday in a sweeping downsizing of the chemical company's 22-member board.
Grace's departure was coincidentally decided on St. Patrick's Day--half a century after he took over the company founded by his Irish grandfather, a refugee from Ireland's potato famine.
The company said Grace decided to leave after the board, at a special meeting in New York, adopted an amendment that forces members over the age of 70 to retire by barring their renomination. The amendment was urged by the College Retirement Equities Fund, an investor that owns 8.2% of Grace stock and is one of the company's largest shareholders.
The chairman's resignation comes two weeks after the company's chief executive, J.P. Bolduc, quit amid controversy spurred by published reports that Grace--who once headed a Reagan Administration panel to slash federal government waste--received lavish perks at company expense.
Grace was said to have received money for nursing care, a Manhattan apartment and a personal chef. Also questioned was $1.3 million in W. R. Grace funds spent by Grace's son, J. Peter Grace III, to pay expenses incurred by HSC Holdings, a company he founded last March.
The company said it was shrinking the size of its board to 12 members prior to the annual shareholders meeting, which generally is held on May 10, and actively searching for a new chief executive. No successor was named for Grace, who will become honorary chairman and have no responsibility for company affairs. Acting CEO Thomas Holmes, who took over when Bolduc resigned on March 2, is not a candidate.
Grace's stock rose $1 a share Friday to $49.875 on the New York Stock Exchange.