Australia-based Austal Limited on Monday evening announced the resignation of Craig Perciavalle, the president of its American subsidiary Austal USA.
In a written release, Austal said that his resignation follows the completion of an investigation conducted by external attorneys but commissioned by the company. That probe reportedly focused on what is believed to be at the center of still ongoing investigations “by US regulatory authorities (notably, the Department of Justice and the Securities Exchange Commission) and the Australian Securities and Investments Commission into historical matters concerning Austal’s Littoral Combat Ship (LCS) program before July 2016.”
Austal USA builds Independence-variant littoral combat ships at its world-class facilities in Mobile, Alabama.
Perciavalle was named president of the shipbuilder in 2007 and oversaw the company’s Coastal Alabama hub growing to employ more than 4,000 people.
Due to the governmental probes in progress, Austal cannot publicly comment outside of the release issued Monday.
“Austal and its wholly owned subsidiary Austal USA have been cooperating with the US regulatory authorities in relation to these investigations,” the company wrote.
The following is an additional portion of Austal’s release:
Austal and Austal USA are engaging with the relevant US regulatory authorities regarding these investigations. It is not possible at this stage to predict what action (if any) they may take in relation to these matters. However, the Company is confident that the proactive steps it has already implemented to strengthen its internal reporting and compliance practices will be taken into account in determining whether there are any potential consequences arising from matters identified by the investigation, as well as ensuring such circumstances do not happen again.
The Company’s relationship with the US Defense Department remains strong. During the course of the US regulatory investigations, Austal has continued to work closely with the US Department of Defense, including on a joint investment in Austal’s Mobile shipyard of approximately US$100 million, to implement a steel shipbuilding capability to complement existing aluminium shipbuilding facilities. Austal recently also delivered its 13th Independence-class LCS from the Company’s shipyard in Mobile, Alabama, the fourth ship delivered by Austal USA to the US Navy in CY 2020.
The commissioning of the externally-facilitated investigation and changes already implemented, including the expansion of internal compliance and governance functions in the USA, demonstrate the seriousness with which Austal is taking this issue and its determination to meet and exceed its global risk and compliance responsibilities.
The company also advised that Austal USA CFO Rusty Murdaugh has been appointed as interim Austal USA president while Austal searches for a permanent replacement to Perciavalle.
Murdaugh became CFO in March 2017. Prior to that, he reportedly spent 30 years in financial management in the defense industry with roles at United Technologies, Goodrich, Honeywell and most recently as vice president of Finance for a business segment of Esterline Technologies.
Sean Ross is the editor of Yellowhammer News. You can follow him on Twitter @sean_yhn
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