Bloomberg News

Olympus Panel Members Fly to London to Interview Woodford

November 30, 2011

(Adds details of Tokyo trip in second paragraph, police protection in fifth.)

Nov. 21 (Bloomberg) -- Michael C. Woodford, the former chief executive officer of Olympus Corp. who questioned payments made for acquisitions, is meeting with members of the company’s independent panel in London today who are probing the deals.

Woodford, who forwarded letters detailing his concerns to the whole board before he was fired, will meet today with three people from the panel flying in from Japan, along with lawyers, he said in a telephone interview. The meeting was arranged before he scheduled a trip to Tokyo this week, he said.

Woodford is due to meet in Japan with prosecutors, the Tokyo metropolitan police and the Securities and Exchange Surveillance Commission to discuss $687 million in payments to advisers he uncovered in the purchase of Gyrus Group Ltd., as well as three other takeovers. Olympus appointed an independent panel, including former judges and a retired prosecutor, to probe the acquisitions and the extent of hidden losses.

The Tokyo-based company is under investigation by Japanese officials on whether it worked with organized crime to obscure billions of dollars of losses, the New York Times reported. Investigators are trying to find out what happened to at least $4.9 billion they say remains unaccounted for and how much of that money went to companies with links to organized crime, according to the newspaper.

Police Protection

Woodford said he will have police protection in Japan throughout his trip.

The Tokyo Stock Exchange said 92-year-old Olympus may be delisted as it faces regulatory and criminal probes at home and abroad. President Shuichi Takayama, who was promoted earlier this month, blamed former Chairman Tsuyoshi Kikukawa, Executive Vice President Hisashi Mori and auditor Hideo Yamada for the cover-up.

Olympus admitted last month it paid $687 million in fees to advisers on Gyrus. Most of that went to a Cayman Islands fund that no longer exists, according to filings from the offshore center’s registry.

It also paid 73.4 billion yen ($954 million) between 2006 and 2008 to increase stakes in News Chef Inc., which makes plastic containers for microwave ovens; Humalabo, a face-cream maker; and recycling company Altis Co., according to a letter Woodford sent to Kikukawa, a copy of which was given to Bloomberg News.

The company then wrote down 55.7 billion yen, or 76 percent, of the acquisition value of the three companies in March 2009.

Olympus has lost $6.2 billion, or 71 percent, of its market capitalization since the board unanimously voted to oust Woodford last month.

The independent panel’s findings are expected by mid- December, the group said earlier this month. The panel said today that it has found no links to organized crime so far in its probe, according to a statement distributed through the Tokyo Stock Exchange.

--Editors: Ken McCallum, Shamim Adam

To contact the reporter on this story: Chris Cooper in Tokyo at ccooper1@bloomberg.net

To contact the editor responsible for this story: Ben Richardson at brichardson8@bloomberg.net


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