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Wednesday, June 11, 2014

Video criticizes NH gubernatorial candidate Havenstein’s record as CEO of Virginia firm

CONCORD – The state Democratic Party launched a blistering Web video Tuesday critical of Republican candidate for governor Walt Havenstein’s performance as CEO of a Virginia contracting firm.

The video claims that during Havenstein’s 2½-year tenure, the company lost 5,000 jobs, had its stock drop 32 percent and suffered a fraud scandal that overcharged New York City taxpayers $600 million, which Havenstein failed to prevent. ...

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CONCORD – The state Democratic Party launched a blistering Web video Tuesday critical of Republican candidate for governor Walt Havenstein’s performance as CEO of a Virginia contracting firm.

The video claims that during Havenstein’s 2½-year tenure, the company lost 5,000 jobs, had its stock drop 32 percent and suffered a fraud scandal that overcharged New York City taxpayers $600 million, which Havenstein failed to prevent.

Havenstein was the former CEO of BAE Systems Inc., of Nashua, before taking the post at SAIC in September 2009.

“Walt Havenstein’s record speaks for itself. When voters learn more at WaltFacts.com, they’ll see that his disastrous tenure as CEO took his company in the wrong direction, just like he would take New Hampshire in the wrong direction.”

The Havenstein campaign responded that the video was entirely “false” and that Havenstein rooted out the corruption in the contracting process and fired those executives linked to it.

The loss in jobs and stock drop were because of the slumping economy and cuts in federal contracts and not mismanagement on Havenstein’s part, his spokesman said.

The Havenstein campaign released a time line and supporting documents to maintain that Havenstein had no knowledge of the so-called CityTime contract with New York that resulted in overcharging for government contracting work.

Press secretary Henry Goodwin said Havenstein retired of his own accord and was not forced out because of his management.

“Once the main objectives of the efforts to fix the CityTime situation had been achieved, Walt did what he felt was best for the company, which was to give it a fresh start by handing the baton to a new CEO,” Goodwin said.

Goodwin also said it was Havenstein who first uncovered the problems with the CityTime contract and brought it to the firm’s board of directors.

The video, titled “Failed Leadership,” insists that Havenstein was paid excessively for poor job performance and saddled taxpayers with massive overpayments.

“As CEO of SAIC, Havenstein made $20 million for himself, but he left the company struggling under contracting scandals,” the video says. “Havenstein’s failed strategy and mismanagement cost the company millions, and he was still given a nearly million-dollar golden parachute.”

In response, Goodwin released a letter from SAIC Board Chairman A. Thomas Young when Havenstein left SAIC to rebut the claim that Havenstein left the firm under a cloud.

“Walt has taken SAIC to new levels during his tenure. Thanks to his leadership, today we’re an $11 billion company, with strong positions in our markets and I am optimistic about our future,” Young wrote. “The board and I are very grateful to Walt for his acumen, vision and stellar management.”

There’s little to dispute the company’s stock and job loss performance.

Government records confirm that when Havenstein started at the company, SAIC had 46,200 employees. The workforce was down to 41,100 in 2012.

Likewise, according to Wall Street reports, the stock price was $71.32 a share when Havenstein took over on Sept. 21, 2009.

On Havenstein’s last day on the job, the stock was worth $48.64.

But the two sides differ widely on Havenstein’s role in dealing with the fraud scandal.

Havenstein said he began an internal probe in June 2010 and soon learned that federal prosecutors were looking into the contract.

A month later, he put the project manager on suspicion of misconduct, and he fired three executives in October 2011.

“While we are aware of no evidence that these individuals had any personal involvement in the fraud uncovered in the CityTime program … we must maintain the highest standards for all of our employees and for our industry, beginning with our management team,” Havenstein wrote in a memo to staff at the time.

“These are extraordinary actions, but they are necessary to make SAIC the strongest company it can be and are essential to uphold the values and performance standards that guide us all.”

Kevin Landrigan can reached at
321-7040 or klandrigan@nashua
telegraph.com. Also, follow Landrigan on Twitter (@Klandrigan).