Gov. Bill Richardson announced Sunday he has withdrawn his name for the position of Secretary of Commerce, citing a pending investigation into a company that has done business with the state.

President-elect Barack Obama said he accepted the governor's decision with regret and has begun looking for a replacement.

"We must move quickly to fill the void left by Governor Richardson's decision," Obama said Sunday.

 A federal grand jury is investigating how a California company that contributed to Richardson's political activities won a lucrative New Mexico state contract.

A person familiar with the proceedings has told The Associated Press that the grand jury is looking into possible "pay-to-play" dealings between CDR Financial Products and someone in a position to push the contract through with the state of New Mexico.

The grand jury is investigating how a California company that contributed to Richardson's political activities won a New Mexico state contract worth more than $1 million.

State documents show CDR was paid a total of $1.48 million in 2004 and 2005 for its work on a transportation program.

CDR and its CEO, David Rubin, have contributed at least $110,000 to three political committees formed by Richardson, according to an AP review of campaign finance records. The largest donation, $75,000, was made by CDR in June 2004 - a couple of months after the transportation financing arrangement won state approval - to a political committee that Richardson established before the Democratic National Convention that year.

Richardson ran against Obama in the Democratic presidential primary, but withdrew after a poor showing in the Iowa caucuses and New Hampshire primary. He is one of the most prominent Hispanics in the Democratic Party, having served in Congress and as President Clinton's ambassador to the United Nations and energy secretary.

As governor, he has kept up an international profile with a specialty in dealing with rouge nations. Obama also considered him to be secretary of state.

Richardson said the investigation may last several weeks, which would slow his confirmation in the US Senate.

"Given the gravity of the economic situation the nation is facing, I could not in good conscience ask the President-elect and his Administration to delay for one day the important work that needs to be done," Richardson said.

Richardson said he and his administration acted properly in business dealings and he plans to stay on as governor.

"For now, I will remain in the job I love, Governor of New Mexico, and will continue to work every day, with Lieutenant Governor Diane Denish, to make a positive difference in the lives of New Mexicans. I believe she will be a terrific governor in the future," Richardson said.

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(The Associated Press contributed to this report.)