UPDATE 2-Reddy Ice sends sales exec on leave; suspends dividend

(Recasts; adds details on sending official on leave, share movement)

Sept 15 (Reuters) - Reddy Ice Holdings Inc (FRZ.N) sent an official in charge of sales and marketing on leave in connection with an antitrust probe and suspended its quarterly cash dividend indefinitely, sending its shares down as much as 18 percent to a new 52-week low.

The largest U.S. manufacturer of packaged ice also said it was undertaking a strategic review of its business and opportunities.

The company is being probed by federal officials in connection with an alleged criminal price-fixing conspiracy in the packaged-ice industry.

Reddy Ice said executive vice president of sales and marketing, Ben Key, has been relieved of his duties effective Sept. 13, after a special committee of the board found that he likely violated company policies and is associated with matters that are under investigation.

"The committee's investigation is ongoing and no conclusions have been reached that any illegal conduct occurred," the company said.

Key could not immediately be reached for comments.

The Antitrust Division of the U.S. Department of Justice and the attorneys general of 19 states and the District of Columbia are conducting investigations of possible antitrust violations in the packaged-ice industry, the company said.

The company, which sells its products primarily under the Reddy Ice brand, said it was continuing to cooperate with the Antitrust Division and the attorneys general in their investigations.

DIVIDEND SUSPENDED

Reddy Ice said no cash dividend will be declared for the period from July 1 to Sept. 30.

"We believe it (suspending dividend) is the best course in light of this year's weaker-than-expected operating results and costs related to the ongoing antitrust investigations and related litigation," Chief Executive Gilbert Cassagne said in a statement.

In August, Reddy Ice posted a 46 percent fall in its second-quarter profit, as it bore $4.6 million of litigation costs related to the ongoing antitrust investigations, and slashed its 2008 outlook.

The company said eliminating dividend will save cash of about $9.3 million per quarter. It previously paid dividend at a rate of $1.68 per share on an annual basis.

NEW CHIEF OPERATING OFFICER

Reddy Ice said it appointed Paul Smith as chief operating officer, effective Sept. 15.