Sirtex axes Gilman Wong, CEO who sold before price fall

The board of biotech Sirtex has sacked CEO Gilman Wong after his October sale of shares before a price plunge.

Sirtex CEO Gilman Wong.

The board of biotech Sirtex has sacked chief executive Gilman Wong following a probe into his sale of millions of dollars worth of stock ahead of a plunge in the group’s share price.

Sirtex’s shock announcement, made well after the market close yesterday, follows an investigation into Mr Wong’s share trading by the $900 million company’s legal advisers Watson Mangioni ordered by the board on December 16.

Mr Wong sold $2.1m worth of shares on October 26 at an average price of $28.48, the day after a Sirtex sales update was questioned by the ASX for using “imprecise terms”.

Sirtex shares most recently traded below $16.

The ASX came back to Sirtex again on December 2 after receiving a tip-off all was not well and received an affirmation broad guidance for “double-digit growth guidance for dose sales” was still current.

Mr Wong’s trades ultimately raised the ire of the regulators a week later, on December 9, when Sirtex shares plunged following a downgrade of dose sales growth guidance to between 5 per cent and 11 per cent.

The query from the ASX forced Sirtex to tap Watson Mangioni to analyse the actions of its CEO. It is believed the Australian Securities & Investments Commission also investigated Mr Wong’s trades, but the outcome of that inquiry is not known.

Last night, Sirtex said Watson Mangioni’s analysis had been completed. While the findings were “privileged and confidential” they have led to the departure of the company’s leader.

“After due consideration, the board of Sirtex has today terminated Mr Wong’s employment with Sirtex, with immediate ­effect,” the company said.

“Mr Wong’s salary and statutory entitlements will be paid to the date of termination.”

Unvested performance rights will be forfeited by Mr Wong.

Sirtex’s blue-chip board is chaired by former HSBC executive Richard Hill, with former Rio Tinto executive John Eady, former Australian Private Equity and Venture Capital Association boss Katherine Woodthorpe and former Ernst & Young partner Grant Boyce as non-executive ­directors.

Investors include AMP, Hunter Hall and Goldman Sachs, although Perpetual on Monday revealed it had sold down to below the 5 per cent substantial holder mark.

No one answered the telephone at Sirtex’s Sydney headquarters last night and the company’s Germany-based public relations officer did not return The Australian’s call.

Chief operating officer Nigel Lange will be acting CEO while an executive search takes place.

Since Mr Wong sold out, Sirtex shares have been in a downward spiral.

The group’s shares ended yesterday’s session at $15.84, down 44 per cent on the level at which Mr Wong sold less than three months ago.

Mr Wong defended the share sale at the time, saying the timing related to the need to meet his tax obligations. “This was in line with my normal practice of the past three years.”