Osicom Chief Quits; Shares Surge on News

Shares of Santa Monica-based computer networker Osicom Technologies surged 16% on Monday after the company announced the resignation of its chairman and chief executive.

Par Chadha, who founded the company in 1981, will resign effective July 8 but will remain as a consultant to the company, according to a filing with the Securities and Exchange Commission.

Rohit Phansalkar, a partner at Andersen Weinroth & Co., a New York investment firm that recently bought a large stake in Osicom, will replace Chadha.

Neither Chadha nor Phansalkar was available for comment.

Osicom shares rose $9.42 to close at $68.17 on Nasdaq in the stock’s heaviest trading volume in nearly two months.

Nevertheless, the stock is far below the peak of almost $150 that it reached in early March, several days before the end of the Nasdaq Stock Market rally.

Osicom’s shares appear to have been hurt in part by fears that Nasdaq’s sell-off could delay a spinoff of its Sorrento Networks Inc. fiber-optic unit.

Osicom has been dogged by controversy in recent years.

Last year, the company acknowledged that a contract it once estimated to be worth $90 million generated only $68,000 in revenue. Chadha said at the time that he stood by the initial prediction of $90 million, saying he was simply conveying to shareholders what was reasonably expected.

In 1998, The Times reported that Osicom had issued a news release saying Chadha had bought almost 350,000 Osicom shares but that the release didn’t mention that Chadha had acquired them from a large shareholder who wanted to sell.