CONCORD, N.H. — Dennis Kozlowski, the dealmaking titan who built Tyco International Ltd. into a massive conglomerate with 277,000 employees, resigned Monday to face an investigation over possible sales tax evasion.

        Investors, already worried about the company's future, sold Tyco stock with a vengeance, sending its shares down 27 percent to $16.05 Monday in extremely heavy trading. Tyco stock is now down 73 percent since Jan. 1.

        Although the investigation appeared to focus on how Mr. Kozlowski managed his vast personal fortune, much of it from sales of company stock, analysts said it raised serious concerns about his oversight of Tyco and its finances.

        “He's someone that pushed the envelope, and this is something that could lead to further questions of the company,” Steven Altman, an analyst with Commerzbank in New York, said.

        Also Monday, Raytheon Co. announced that Mr. Kozlowski had resigned his post on the board of the Lexington, Mass.-based defense giant.

        Tyco was already under fire for Enron-inspired questions about how it accounted for the huge number of acquisitions Mr. Kozlowski made in the 1990s as he turned Tyco into a corporate behemoth producing products ranging from undersea fiber-optic cable to coat hangers.

        The company said Mr. Kozlowski resigned for “personal reasons” after informing board members Friday about the investigation.

        Sherry Hunter, a spokeswoman for Manhattan District Attorney Robert Morgenthau, would say only that Mr. Kozlowski and others she did not name are the subjects of a sales tax investigation.

        The New York Times reported Monday that prosecutors believe Mr. Kozlowski moved hundreds of millions of dollars into family trusts, then used the trusts to buy goods and services without paying New York state sales taxes.

        The report, which cited unnamed lawyers involved in the investigation, said Kozlowski has been under criminal investigation for several months.

        In the last few weeks, a grand jury has issued subpoenas and taken testimony, the lawyers told the newspaper. No criminal charges have been filed.

        Tyco executive vice president Brad McGee said the probe “is an investigation of Dennis as an individual, not as CEO of Tyco.” Company officials are not aware of any Tyco employees under investigation, McGee said.

        Kozlowski's lawyer, Stephen Kaufman, did not return repeated telephone messages left Monday seeking comment. Kozlowski could not be reached to comment.

        Tyco, based in Bermuda but run from Exeter, N.H., said board member John Fort, who headed Tyco from 1982 to 1992, would take over immediately as interim chief executive until a permanent replacement is found. Through a spokesman, Fort declined a request for an interview.

        Shares of Tyco fell 26.9 percent, or $5.90 a share, to $16.05 Monday on the New York Stock Exchange. The stock's 52-week high was just over $60 a share in December.

        The resignation of Kozlowski — a motorcyclist, sailing enthusiast and avid tennis player who split his time between the company's offices in New Hampshire and in Boca Raton, Fla. — came as the company has struggled for months to restore a severe hit in investor confidence.

        Critics say Tyco used accounting tricks when it bought companies to make its profits appear to grow faster than they actually did.

        Kozlowski, an accountant who rose through the ranks of Tyco and became chief executive in 1992, cemented his reputation as a dealmaker by acquiring a new company for Tyco nearly every business day during the 1990s. Many have compared Tyco to General Electric Co. — and Kozlowski to Jack Welch, GE's acquisitive former chief executive.

        Along the way, Kozlowski received ample compensation. In 2000, Kozlowski's best year, he received $25 million in salary and other benefits and exercised options worth nearly $100 million.

        The son of a Newark, N.J., police detective, Kozlowski has a house in the Seacoast region of New Hampshire and in Boca Raton. He drives a Harley-Davidson motorcycle, flies helicopters and airplanes and has sailed in the Newport Bermuda Race, an annual yacht race from Newport, R.I. to Hamilton, Bermuda.

        In New Hampshire, he keeps his helicopter at a heliport two miles from his home and flies it primarily for pleasure. In Florida, his 15,000-square foot home with a pool, cabana, dock and tennis courts sits along the Intracoastal Waterway.

        But Kozlowski didn't like the layout of the tennis courts and how the sun got in his eyes, so he bought a $3 million house and tore it down to reposition the courts, the Palm Beach Post reported last week, citing unnamed sources.

        During his tenure leading Tyco, the company gained a reputation of acquiring other companies and slashing jobs — some say ruthlessly — to streamline operations.

        Kozlowski has always said his business strategy was to create value for Tyco shareholders. But in January, he announced a plan to break the company apart into four parts.

        After months of investor concerns about Tyco's accounting practices, Kozlowski reversed course in April and said the breakup plan was a mistake. At the time, some investors said he should resign, but Kozlowski said he would stay on.

        Kozlowski told the company's directors Friday about the investigation and said he would resign. McGee would not say whether the board pressured Kozlowski to leave the company.

Andersen employees defecting
Erpenbeck camp claims forgery
Top exec's exit is latest blow for Tyco
Tourism goes regional
State pulling travel brochures that promote Indiana casinos
Woman is executive editor of Detroit Free Press
Automakers looking up
ISM bolsters recovery hopes
Libel on the Internet?
Microsoft, SEC settle complaint
Napster's newest chapter: 11
Prosecutors imply Riley should have expected inquiry
Software glitch cancels Knight trades
StarBand claims merger was blocked
Business Digest
Tristate Summary
What's the Buzz?