You are not making much sense. Was he destroying the company or not? What kind of destruction does not have obviously visible signs (to everyone) that can be acted on? What Kind of board sits down and decides that the destruction of the company is worth investor panic because 'it's worse than it looks'. What, are investors going to be calm as he destroys the company?

Do you think a CEO is a King or what that they are destroying a company and that's not enough to get booted? CEOs get fired all the time. A Board certainly doesn't need an affair pretext to boot one that is actively tanking the company.