Jonathan Bush, the outspoken CEO of health care IT and analytics firm Athenahealth, is stepping down from his perch as chief executive effective immediately, the company announced in a statement Wednesday. Bush’s resignation comes in the midst of an unsolicited takeover bid by Paul Singer’s activist hedge fund Elliott Management—as well as reports from Bloomberg and others of alleged inappropriate behavior by Bush in the past.
Jeff Immelt, the former CEO of GE who was recently made Athenahealth’s chairman, will take over day-to-day operations as executive chairman alongside CFO Mark Levine and Amy Abernethy, the chief medical officer at Flatiron Health and Athenahealth board member who will now advise the firm’s leadership team on data strategy. Athenahealth said it is exploring a range of strategic options, including a potential sale or merger.
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“I believe that working for something larger than yourself is the greatest thing a human can do. A family, a cause, a company, a country—these things give shape and purpose to an otherwise mechanical and brief human existence,” said Bush in a statement. “With that lens on, it’s easy for me to see that the very things that made me useful to the Company and cause in these past twenty-one years, are now exactly the things that are in the way. I cannot imagine a single organization more loaded with potential to transform healthcare.”
Bush has a reputation for his outsize personality and bombastic presentations at health industry events. In recent weeks, and amid Elliott’s aggressive bid for the company, reports have emerged about Bush’s treatment of his former spouse and allegations of inappropriate workplace behavior. On the former count, Bush apologized last week for assaulting his ex-wife; Bloomberg also reported on a 2007 complaint by a female former Athenahealth employee alleging wrongful termination and claiming that Bush had “engaged in highly inappropriate conduct regarding a female employee at an awards banquet in or around early 2005.” A video clip from an industry event provided to the outlet also appears to depict Bush making a lewd joke.
Fortune has reached out to Athenahealth to request comment from Bush on those allegations. A company spokesperson said they could not comment beyond what was included in the firm’s Wednesday press release, but had this to say about the Bloomberg report: “Like almost any public company, athenahealth has been the subject of various employment-related claims from time to time. We do not disclose details of individual claims, but can affirm that the Company’s decision to settle a claim does not necessarily speak to its credibility or merit.”
It’s unclear whether or not those reports specifically led to Bush’s resignation. But Elliott Management’s business case for its $160-per-share takeover offer has focused on its market strategy, with Singer and company asserting that Athenahealth would benefit from becoming a private company. At least some analysts, such as investment firm RBC, have agreed, and Athenahealth shares have spiked up to $157 following the revelation of Elliott’s bid.
“We fear Athenahealth could be facing a multi-year turnaround story, as nothing happens quickly in Healthcare IT,” said RBC in its note. “We believe current investors could be well served by endorsing the activist’s $160/share (or better) offer for Athenahealth shares, and we view the take-private opportunity as an attractive exit.”
Athenahealth stock was up 4% in early Wednesday trading.
