Japan's scandal-hit Olympus delays earnings

4th November 2011, Comments 0 comments

Scandal-hit Japanese camera maker Olympus on Friday said it will postpone its first-half earnings release, citing the recent launch of an independent investigation into the acquisitions of four firms.

Olympus had originally planned to release its earnings report on November 8 but on Friday said it needed more time to compile the results, which it now hopes to publish by the end of November.

Olympus has been mired in crisis since the ousting of its British Chief Executive and President Michael Woodford on October 14, who contends he was sacked because he raised questions about payments made in the four deals.

Woodford was dismissed only six months after being appointed president and two weeks after he was also named chief executive, and Olympus shares have since fallen by more than half on the Tokyo Stock Exchange.

A 30-year company veteran and Olympus' first non-Japanese president and chief executive, Woodford said he was removed after he wrote to chairman Tsuyoshi Kikukawa and urged him to resign over the payments, citing major governance concerns.

Kikukawa assumed Woodford's roles but, under increasing pressure as media scrutiny and shareholder anxiety intensified, stood down less than two weeks later.

On Tuesday Olympus announced the names of a panel set up to probe allegations of massive overpayments in takeover deals that have rocked the company.

The six-member committee, headed by former Supreme Court judge Tatsuo Kainaka, will also include four lawyers and one certified accountant, the firm said.

They will investigate four acquisitions that Olympus made between 2006 and 2008, including a $1.92 billion deal for British medical-instruments company Gyrus Group in which Olympus has admitted paying $687 million to a little-known financial adviser based in the Cayman Islands.

Also under scrutiny is the purchase of three small Japanese companies unrelated to its core precision instruments business for a total of 73.49 billion yen ($966 million at current rates) between 2006 and 2008. The company heavily wrote down their value a year later.

Olympus shares were 8.41 percent lower at 1,099 yen in Tokyo trade on Friday.

© 2011 AFP

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