Sony to fling $642m at scandal-hit Olympus
Electronics firm to bag a stake as camera-maker's execs go on trial for fraud
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Sony is reportedly about to invest ¥50bn ($642m) in beleaguered digital camera-maker Olympus, giving it a 10 per cent stake in the firm.
The Japanese electronics giant will set up a joint business with Olympus to develop new medical equipment and get a seat on the board next year, three sources whispered to Reuters.
Olympus has been struggling since revelations last year of an accounting coverup hiding huge investment losses, leaving its share price foundering and a massive hole in its revised finances.
Three of the company's former executives went on trial today and pleaded guilty to the $1.7bn cover-up exposed by former chief executive Michael Woodford.
"The full responsibility lies with me and I feel deeply sorry for causing trouble to our business partners, shareholders and the wider public," ex-chairman Tsuyoshi Kikukawa told the Tokyo district court.
"I take full responsibility for what happened."
The executives, also including former executive VP Hisashi Mori and former auditor Hideo Yamada, have been charged with inflating the company's net worth in five years' of financial statements up to March 2011. The executives were trying to hide losses the firm made from risky investments in the late 1980s. The firm has admitted to using "improper accounting" in the cover-up.
After revising its statements and with the scandal hitting its share price, Olympus is in need of a cash injection to sort itself out and pundits have speculated whether the firm will need to go as far as a merger or takeover.
At the end of May, rumours suggested that Panasonic or Sony could be in line for a stake as Olympus started restructuring plans including axing 2,700 staff and closing or merging some of its 30 factories.
Sony had not returned a request for comment at the time of publication. ®
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COMMENTS
Re: Newsflash: Company caught cooking the books!
Dead easy. Japanese people believe it's important to have integrity. Anglo-Saxons do not.
Anyway, you'll have to excuse me. I have an appointment to sell my grandmother.
Sony had not returned a request
They probably decided to keep it.
Newsflash: Company caught cooking the books!
So a single Japanese medical equipment/photographic technology company was caught doing some creative accounting ... I seem to recall a news story from a few years ago where the worlds banks were not only cooking their own books but conspiring with each other and the supposed regulators to maintain and sustain the financial fictions.
In the case of Olympus, who hurt no-one but themselves when they were found out, those involved are prosecuted, pilloried and hung out to dry.
In the case of the banks who damn near brought the world to it's knees (a position from which much of the world is still only slowly getting up from) the executives get given bonuses and governments line up to give the banks themselves even more money (taken from our pockets) to keep them going.
Can anyone figure this out ?
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