By Mariko Yasu - Nov 8, 2011 7:22 AM GMT+0700
Olympus Corp. (7733), reeling from a scandal about payments made for a 2008 acquisition, said it used fees paid to advisers on the takeover of Gyrus Group Plc and others to hide losses from investments in the 1990s.
Olympus funneled the advisory fees to several investment funds to cancel unrealized losses that the company had kept off its financial statements, according to a statement from the Japanese camera maker to the Tokyo Stock Exchange today. The company apologized to shareholders and stakeholders.
Olympus President Shuichi Takayama will meet the press at 12:30 p.m. in Tokyo today, Tsuyoshi Kitada, a Tokyo-based spokesman, said by phone.
The company, the world’s biggest maker of endoscopes, lost more than half of its market value since firing President Michael C. Woodford Oct. 14 after he questioned the $687 million in fees paid to advisory firms for the $2 billion takeover of Gyrus in 2008.
The company last week set up a six-person independent investigation, including two former judges and a retired prosecutor, to probe the $1.4 billion of writedowns and fees related to acquisitions. Use of the advisory fees to hide losses was found by the investigation panel.
Olympus Chairman and President Tsuyoshi Kikukawa, who had Woodford removed, resigned himself on Oct. 26 as investors increased the pressure for a review of the deals.
Olympus last week said there was nothing illegal about the takeover of Gyrus. The acquisitions of three Japanese companies unrelated to its main cameras and medical equipment operations were part of an expansion into new businesses, the company said.
To contact the reporter on this story: Mariko Yasu in Tokyo at myasu@bloomberg.net
To contact the editor responsible for this story: Kyung Bok Cho at kcho7@bloomberg.net
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