Olympus head quits amid takeover-fees scandal
Updated: 2011-10-26 20:33
TOKYO - Olympus Corp head Tsuyoshi Kikukawa resigned on Wednesday after a scandal over hefty advisory fees wiped out half of the 92-year-old firm's market value, but his successor stuck with the company's line that it had done nothing wrong.
Olympus Corp. newly-appointed President Shuichi Takayama attends at a news conference in Tokyo October 26, 2011. [Photo/Agencies]
Sources told Reuters that Japan's securities watchdog was looking into past Olympus takeover deals, focusing on whether it has properly disclosed relevant information.
Olympus fired its British President and Chief Executive Michael Woodford on October 14, just two weeks after his appointment as CEO, saying he failed to understand the company's management style and Japanese culture. Kikukawa then took over Woodford's role.
Woodford, who joined the camera and endoscope maker in 1980, said he was sacked for questioning a $687 million advisory fee paid in relation to a $2.2 billion takeover in 2008 as well as other deals, and for urging Kikukawa to step down.
"For now the stock should rebound on his resignation, but in reality nothing has been cleared up. There are still many investigations left to come," said Koichi Ogawa, chief portfolio manager at Daiwa SB Investments.
Woodford told Reuters that Kikukawa's resignation was "a start" but added that his replacement -- Shuichi Takayama, a 41-year company veteran -- had also failed to demand explanations about hefty fees linked to acquisitions.
Takayama sniped back at the ex-CEO turned whistleblower, telling a news conference there was no problem with fees paid by Olympus and that the company was extremely angry that Woodford revealed internal information while he was still a director.
"I was one of those who agreed to Mr Woodford's dismissal. The reason was his autocratic actions, and these included intimidation of my own staff."
Kikukawa said in a separate statement he had stepped down to restore confidence in the company under the new management and that he would continue to work as a director.