Olympus: Woodford report ‘open to misinterpretation’ (update Thursday)
October 19, 2011
Olympus Tokyo has today confirmed it paid $687m to financial advisers over an acquisition in 2008, but claims a report commissioned by its ousted chief executive suggesting this was excessive was ‘open to misinterpretation’.
In a statement released today (19 October), Olympus also dismisses claims made by its former CEO Michael Woodford as ‘supposition and speculation’.
In an interview with the BBC, Woodford claims Olympus paid ‘nearly $700m to unknown parties in the Cayman Islands’.
Today, Olympus confirmed it is still considering legal action against Woodford for ‘disruption to business and loss of corporate value’ since his sacking last Friday.
Olympus dismisses press reports that his demand for certain Olympus managers to resign was the real reason for his dismissal.
‘In fact, this request itself was not a direct reason for the decision and instead represents no more than another of the numerous arbitrary actions taken by Mr Woodford,’ claims Olympus.
However, the statement confirms that Woodford did call for ‘certain members of the management team to resign’ when he submitted a report to the board containing claims Olympus paid excessive commission to a financial adviser in relation to its takeover of Gyrus – an acquisition agreed on 21 June 2007.
Woodford was sacked after he claimed that Olympus’s payment of $687m was well over the odds for such a deal.
Earlier this week, Woodford handed a report on his findings to the UK’s Serious Fraud Office.
Yesterday, Olympus chairman Tsuyoshi Kikukawa denied that the firm paid financial advisers excessive commission in relation to acquisition of the British medical equipment firm.
Today’s statement from Olympus adds: ‘Also the [Woodford] report itself contains a large amount of material that is based on supposition and speculation and the company believes its content is at variance with the facts and open to misinterpretation’.
Olympus maintains that it fired Woodford – who was just two weeks in the job – because of ‘major differences’ over ‘the direction and conduct of the company’s business and this had become an impediment to management decision-making’.
The firm adds: ‘Regarding reports in some media that Mr Woodford had commissioned a report from an external agency, this was done by Mr Woodford at (sic) his own initiative and had no bearing on the audit of Olympus Corporation or its group of companies.’
Olympus confirmed that Woodford ‘remains a director of the company at this point in time’.
The full Olympus Tokyo statement can be read here: http://www.olympus-global.com/en/corc/ir/tes/pdf/nr111019.pdf