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Olympus' losses pull stock down
Source: Agencies |
November 10, 2011, Thursday
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Print Edition
Print Edition
LOSSES on securities investments at the core of a scandal rocking Japan's Olympus Corp may have once exceeded US$1 billion, the Nikkei newspaper said yesterday, as the firm's share price plunged again on doubts about its future.
Olympus admitted on Tuesday it used M&A deals to hide losses dating back two decades, a revelation that followed a public campaign by ex-CEO Michael Woodford to get the 92-year-old maker of endoscopes and cameras to explain mysterious deals.
The scandal has raised questions about Japan's corporate governance and revived memories of the dark days after Japan's bubble of soaring share and land prices burst in 1990, leaving many top firms with losses on fancy financial deals and looking for ways to hide them.
"If other Japanese companies are also viewed with suspicion due to the Olympus affair, they may have trouble raising funds," said a Nikkei editorial.
It said Japan's financial watchdogs and prosecutors should stay on top of the case and cooperate with overseas authorities who are also probing it.
Olympus declined to comment on the Nikkei report, which quoted sources close to the matter.
Olympus' share price plunged 20.4 percent to 584 yen (US$7.51) yesterday, falling by its daily trading limit of 150 yen.
Company President Shuichi Takayama on Tuesday blamed Tsuyoshi Kikukawa, who quit as president and chairman on October 26, Vice-President Hisashi Mori and internal auditor Hideo Yamada for the cover-up that used funds related to M&A deals, saying he would consider criminal complaints against them.
But he declined to detail how the losses had occurred or the amounts involved before an external panel ends a probe.
Olympus admitted on Tuesday it used M&A deals to hide losses dating back two decades, a revelation that followed a public campaign by ex-CEO Michael Woodford to get the 92-year-old maker of endoscopes and cameras to explain mysterious deals.
The scandal has raised questions about Japan's corporate governance and revived memories of the dark days after Japan's bubble of soaring share and land prices burst in 1990, leaving many top firms with losses on fancy financial deals and looking for ways to hide them.
"If other Japanese companies are also viewed with suspicion due to the Olympus affair, they may have trouble raising funds," said a Nikkei editorial.
It said Japan's financial watchdogs and prosecutors should stay on top of the case and cooperate with overseas authorities who are also probing it.
Olympus declined to comment on the Nikkei report, which quoted sources close to the matter.
Olympus' share price plunged 20.4 percent to 584 yen (US$7.51) yesterday, falling by its daily trading limit of 150 yen.
Company President Shuichi Takayama on Tuesday blamed Tsuyoshi Kikukawa, who quit as president and chairman on October 26, Vice-President Hisashi Mori and internal auditor Hideo Yamada for the cover-up that used funds related to M&A deals, saying he would consider criminal complaints against them.
But he declined to detail how the losses had occurred or the amounts involved before an external panel ends a probe.
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