Feeds

Olympus gets government grilling after firing nosy Brit boss

Japanese prime minister cites multimillion dollar 'irregularities'

Internet Security Threat Report 2014

The Japanese prime minister has called for clarification from Olympus’ board of directors over hundreds of millions of dollars in fees paid out during recent takeovers – deals the company’s short-lived British CEO claims he was fired for investigating.

In an interview with the Financial Times, PM Yoshihiko Noda said the board must clarify why it paid such high fees in its activities - money which appears to have been paid into tax havens. Noda also said that Olympus may bring other Japanese firms into disrepute.

It's highly unusual for such a senior political figure to raise concerns about corporate life, but the Olympus case has many people nervous.

“What worries me is that it will be a problem if people take the events at this one Japanese company and generalise from that to say Japan is a country that [does not follow] the rules of capitalism,” Noda said. “Japanese society is not that kind of society.”

At issue is the $687m paid out in fees after the 2008 purchase of the Gyrus Group, a British medical device manufacturer, for approximately $2bn. The amount far exceeds the usual fees paid to consultants in such a deal, and have raised fears of financial irregularities.

In April, Olympus appointed its first non-Japanese president, Michael Woodford – a British 30-year company veteran – and then promoted him to CEO six months later. However, two weeks after being unanimously voted in, he was unanimously voted out – a decision he said stemmed from him asking too many questions about the fees paid in the deal.

“Michael C. Woodford has largely diverted from the rest of the management team in regard to the management direction and method, and it is now causing problems for decision making by the management team,” the company said at the time.

However, the questions Woodford raised have not gone away, and the company has found itself under increasing scrutiny. Last week, Woodford’s replacement as president, Tsuyoshi Kikukawa, was forced to step down as speculation over the affair grew and Olympus’ share price almost halved, wiping billions from its value.

Southeastern Asset Management, which owns about five per cent of Olympus’ stock, has now also chimed in, with a letter of concern it sent to the board on 20 October but has not made public. It said that it is very concerned by the Woodford allegations and requested the board minutes covering the transactions and details on why so much was paid in fees.

Providing a secure and efficient Helpdesk

More from The Register

next story
Scrapping the Human Rights Act: What about privacy and freedom of expression?
Justice minister's attack to destroy ability to challenge state
WHY did Sunday Mirror stoop to slurping selfies for smut sting?
Tabloid splashes, MP resigns - but there's a BIG copyright issue here
Hey Brit taxpayers. You just spent £4m on Central London ‘innovation playground’
Catapult me a Mojito, I feel an Digital Innovation coming on
Google hits back at 'Dear Rupert' over search dominance claims
Choc Factory sniffs: 'We're not pirate-lovers - also, you publish The Sun'
EU to accuse Ireland of giving Apple an overly peachy tax deal – report
Probe expected to say single-digit rate was unlawful
Inequality increasing? BOLLOCKS! You heard me: 'Screw the 1%'
There's morality and then there's economics ...
While you queued for an iPhone 6, Apple's Cook sold shares worth $35m
Right before the stock took a 3.8% dive amid bent and broken mobe drama
EU probes Google’s Android omerta again: Talk now, or else
Spill those Android secrets, or we’ll fine you
prev story

Whitepapers

Forging a new future with identity relationship management
Learn about ForgeRock's next generation IRM platform and how it is designed to empower CEOS's and enterprises to engage with consumers.
Storage capacity and performance optimization at Mizuno USA
Mizuno USA turn to Tegile storage technology to solve both their SAN and backup issues.
The next step in data security
With recent increased privacy concerns and computers becoming more powerful, the chance of hackers being able to crack smaller-sized RSA keys increases.
Security for virtualized datacentres
Legacy security solutions are inefficient due to the architectural differences between physical and virtual environments.
A strategic approach to identity relationship management
ForgeRock commissioned Forrester to evaluate companies’ IAM practices and requirements when it comes to customer-facing scenarios versus employee-facing ones.