Olympus replaces CEO as scrutiny of past deals grows
- 26 October, 2011 23:39
Olympus abruptly replaced its CEO on Wednesday after less than two weeks on the job, as pressure continues to build on the company over questionable deals in recent years.
The Japanese manufacturer of cameras and medical equipment has been at the center of a growing scandal over large fees it paid for acquisitions in the past. A former head of the company says he was forced out when he tried to investigate, and media reports say the company is now under investigation by authorities in three countries. The company's share price has lost more than half its value since Oct. 14.
The Tokyo-based company said Wednesday night it was installing Shuichi Takayama as its new CEO, replacing Tsuyoshi Kikukawa.
Kikukawa took over less than two weeks ago for British CEO Michael Woodford, who the company said at the time had "largely diverted from the rest of the management team."
Woodford immediately went public with a series of high-profile interviews, alleging he was fired when he challenged the company's board over a series of acquisitions that cost nearly $800 million and later lost most of their value, including for companies that made things like face cream and plastic containers for microwave ovens. He also questioned nearly $700 million in payments to two financial advisers in a separate deal for medical tech firm Gyrus, over a third of the total $2 billion purchase price.
As news of the scandal unfolded, media around the world have reported that the U.S. Federal Bureau of Investigation, Britain's Serious Fraud Office, and Japan's Securities and Exchange Surveillance Commission are investigating.
In recent days Japanese media coverage of the ordeal has increased, with the country's largest business newspaper, the Nikkei, calling for a complete investigation and full disclosure of the results.
A brief message from incoming CEO Takayama was posted prominently on the company's website Wednesday, apologizing to customers, partners and shareholders.
"The acquisitions covered in newspapers and other media were carried out with appropriate valuations and procedures. There has been absolutely no wrongdoing, but we are preparing to form a third party which will impartially investigate the matter," he said in the message.