Olympus Used Fees to Hide Losses

Discussion in 'The Watering Hole' started by Biro, Nov 7, 2011.

  1. Biro

    Biro Mu-43 All-Pro

    May 8, 2011
    Jersey Shore
    Real Name:
    I knew there was something behind the dismissal of Olympus CEO Micheal C. Woodford that went way beyond cultural differences. Here's a link to a Bloomberg News report:

    Olympus Used Gyrus Fees to Hide Losses - Bloomberg

    I said in early posts on this subject that any "cultural differences" may have had more to do with western ideas about corporate governance than anything else. Frankly, I was surprised that a great number of forum members were so sanguine on the subject, taking a "they all do it" attitude. But the truth is, they don't all do it and shouldn't do it.

    I still think Olympus is a great company that makes great products... that I will continue to buy. Engineers and factory workers have nothing to do with this. But a housecleaning is in order at the board level.
    • Like Like x 1
  2. starlabs

    starlabs Mu-43 Top Veteran

    Sep 30, 2010
    Los Angeles
    Damn, what a shame... Imagine if all that money had gone into research and making better cameras. *sigh* :frown:
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  3. krugorg

    krugorg Mu-43 Hall of Famer

    Jul 18, 2011
    Minnesota USA
    I don't know what I don't know about corporate finance, but I wonder if this isn't going to force them to sell off the consumer camera division! :eek: I want my E-P5!
  4. John M Flores

    John M Flores Mu-43 All-Pro

    Jan 7, 2011
    Somerville, NJ
    I wonder if the sinking stock price makes them a takeover target? Who might want to buy them? Ricoh?
  5. M4/3

    M4/3 Mu-43 Top Veteran

    Sep 24, 2011
    I agree starlabs. I also lament the fact that a sizable chunk of the profit Olympus makes on their pricey Pen cameras, $20 USB cables, $7 lens covers, etc., ends up being spent on under the table type payoffs instead for bonuses for Olympus's R&D employees for making innovative improvments to their cameras and medical imaging products.
    I've noticed Olympus's stock price is STILL sinking - now about 60% down from pre-scandal disclosure levels.
  6. RT_Panther

    RT_Panther Mu-43 Legend

    May 4, 2011
  7. MajorMagee

    MajorMagee Mu-43 All-Pro

    Feb 24, 2011
    Dayton, OH
    I would think a Chinese company might want to buy them up.
  8. Biro

    Biro Mu-43 All-Pro

    May 8, 2011
    Jersey Shore
    Real Name:
    That would make a lot of sense, as the Chinese are on a major drive to pick up technology that they don't yet have. I wonder if Olympus has a "poison pill" clause in its bylaws to prevent hostile takeovers.
  9. shnitz

    shnitz Mu-43 Top Veteran

    Aug 25, 2011
    Austin, TX
    Definitely, anyone involved needs to resign. Re-instating Woodford would be a great move; it would show investors that there is a new level of transparency at the company, and they're taking drastic steps to go back on the right track.

    I also can't believe how many people defended Olympus. It reminds me of when a friend on a BMW car forum showed me a thread in which this guy was bragging about his job and how it gave him the money to have a pimped-out M3. Turns out that the guy's business was a telecommunications scam, and there were people on that forum doing the same thing, defending his actions. It just goes to show how easily illicit behavior can occur, how people willing are to be complicit, or just turn the other way.
  10. GaryAyala

    GaryAyala Mu-43 Legend

    Jan 2, 2011
    wow ... the entire mess just stinks.
  11. soundimageplus

    soundimageplus Mu-43 Top Veteran

    Feb 2, 2010
    Its seems to be getting worse:-

    There's now talk of the company being delisted from the Japanese Stock Exchange, Its value collapsing, criminal proceedings etc.

    At some point surely this means suppliers can't be paid, employees can't be paid, so at some point liquidation and/or bankrupcy are on the cards.

    From our point of view, I guess the best hope is that they get split up and sold off. There's a view that all this will make Olympus a prime target for a takeover and in the current situation, something like the camera division could probably be bought up for not a lot.

    Many of us would wish to see the Olympus brand survive I'm sure, certainly I would, and maybe in the long run it could be a good solution. However what happens to all those employees who are innocent of any wrong doing is anybodys guess.
  12. betamax

    betamax Mu-43 Regular

    May 7, 2011
    NSW, Australia
    Real Name:
    These were losses incurred in the past. I guess the question is, how much more bad news is there? Losses that we still don't know about. If this is the extent of it, then it can survive with someone like Woodford at the top as a sign that they've got nothing more to hide. But they need to do this quickly.

    I think though I read somewhere that Olympus's camera division lost $200 million last year?
  13. wattseee

    wattseee Mu-43 Regular

    Jun 14, 2011
    do you mean $70? $7 is a bargain!!!
  14. GaryAyala

    GaryAyala Mu-43 Legend

    Jan 2, 2011
    Olympus is a large company. If the company is on the verge of collapse, I think it would get a bail out from the government or from some type of consortium coming together for this purpose and in exchange the consortium will rip off Oly trade secrets making Oly less competitive.
  15. Ned

    Ned Mu-43 Legend

    Jul 18, 2010
    Alberta, Canada
    I would rather see a bail-out than a takeover from an electronics company. Ricoh buying Pentax was okay, but I wouldn't want to again see a traditional camera maker get engulfed by an electronics giant, like what happened to Minolta. I'm sorry, but I just can't bring myself to really like the Sony cameras because they don't feel like a camera to me, they feel like an electronics device. My Minolta was a real camera, for sooth!