Peter Gregg, Managing Director and CEO of Primary Health Care Limited (ASX: PRY), has resigned from his position after being charged with falsifying the books and records during his time with another business previously.
On Tuesday last week, Primary Health Care confirmed that Mr Gregg had been served with a Local Court attendance notice by the Australian Securities and Investments Commission, or ASIC, regarding two contraventions of the Corporations Act during his time as CFO of Leighton Holdings Limited.
As reported by The Sydney Morning Herald, the charges relate to him allegedly signing off a $15 million offshore payment in 2011. The SMH goes on to say that, if proven, the charges could see him serve up to two years in prison on each charge, while he could also receive fines and be banned from managing companies for up to five years.
The announcement regarding Mr Gregg's resignation on Friday did make reference to the investigation, although it paid greater focus to the Board's respect for him. It noted that he had successfully led Primary Health Care through a significant period of change and transformation.
It went on to say that the board "has great respect for Peter who, on stepping into his role, immediately took action to enhance Primary's business amid industry headwinds. He is an executive of exceptional quality who has acted with the highest integrity during his time at Primary. The Company and its stakeholders have greatly benefited from his leadership."
Peter will remain in the position until the company completes its internal and external search for a replacement, which will help limit any transitional issues from occurring. Indeed, Primary Health Care's search for a new leader comes at a time of uncertainty for its industry due to changing regulations, with others such as Sonic Healthcare Limited (ASX: SHL) and Capitol Health Ltd (ASX: CAJ) also in the firing zone.
Indeed, Primary Health Care wasn't the only medical business that parted ways with its CEO after market-hours on Friday. The embattled Sirtex Medical Limited (ASX: SRX) will also begin a search for a new CEO after terminating CEO Gilman Wong's employment with the company following an investigation into his trading of Sirtex shares.
Primary Health Care's share price rose 0.8% to $4.00 following the announcement. Primary Health Care's shares have almost doubled in price since mid-February 2016, when they fell as low as $2.13. Given the uncertainty facing the industry, investors may want to steer clear of the business' shares, for now, and focus on some of the other great opportunities presenting themselves across the ASX.
