Olympus Corp, under fire from shareholders amid questions about US$687 million in payments to advisers, plunged in Tokyo trading after a report the US Federal Bureau of Investigation is probing the maker of optical equipment.
Tokyo-based Olympus fell 11 percent to close at ¥1,099 on the Tokyo Stock Exchange yesterday, dropping to its lowest since October 1998. The benchmark Nikkei 225 Stock Average gained 1.9 percent.
The FBI is investigating payments by Olympus to advisers on a 2008 acquisition, the New York Times reported, citing two people briefed on the case, without disclosing their names. The paper said the payout was more than 30 times the normal amount for similar deals.
Tsuyoshi Kitada, a spokesman for Olympus in Tokyo, said the company had no information on any FBI investigation.
“Uncertainty about Olympus’ management and the M&A [merger and acquisition] payments has increased,” said Yoshihiro Ito, chief strategist at Okasan Online Securities Co in Tokyo. “Foreign fund managers and short-term speculators are selling the shares.”
Shareholders including Nippon Life Insurance Co have called for more information about the adviser payments, which were revealed by Michael Woodford, who was fired as chief executive officer on Oct. 14.
Olympus on Wednesday said it paid US$687 million in fees, including a US$443 million buyback of preferred shares, in connection with the US$2 billion purchase of Gyrus Group PLC in 2008. Chairman Tsuyoshi Kikukawa said on Tuesday last week the amount was only about half that much.
Shares of the world’s biggest maker of endoscopes have fallen by 56 percent, erasing more than US$4.5 billion in market value, in the seven trading days since Woodford was fired. Woodford, Olympus’ first non-Japanese CEO, has said he was ousted for challenging the payments to advisers on the Gyrus transaction.
“The situation is still unclear and may take a while to settle,” Mitsuo Shimizu, an analyst at Cosmo Securities Co in Tokyo, said by telephone.
“That’s worrying investors and prompting them to unload their stakes,” Shimizu said.
BUSINESS UPDATE: The iPhone assembler said operations outlook is expected to show quarter-on-quarter and year-on-year growth for the second quarter Hon Hai Precision Industry Co (鴻海精密) yesterday reported strong growth in sales last month, potentially raising expectations for iPhone sales while artificial intelligence (AI)-related business booms. The company, which assembles the majority of Apple Inc’s smartphones, reported a 19.03 percent rise in monthly sales to NT$510.9 billion (US$15.78 billion), from NT$429.22 billion in the same period last year. On a monthly basis, sales rose 14.16 percent, it said. The company in a statement said that last month’s revenue was a record-breaking April performance. Hon Hai, known also as Foxconn Technology Group (富士康科技集團), assembles most iPhones, but the company is diversifying its business to
Apple Inc has been developing a homegrown chip to run artificial intelligence (AI) tools in data centers, although it is unclear if the semiconductor would ever be deployed, the Wall Street Journal reported on Monday. The effort would build on Apple’s previous efforts to make in-house chips, which run in its iPhones, Macs and other devices, according to the Journal, which cited unidentified people familiar with the matter. The server project is code-named ACDC (Apple Chips in Data Center) within the company, aiming to utilize Apple’s expertise in chip design for the company’s server infrastructure, the newspaper said. While this initiative has been
GlobalWafers Co (環球晶圓), the world’s No. 3 silicon wafer supplier, yesterday said that revenue would rise moderately in the second half of this year, driven primarily by robust demand for advanced wafers used in high-bandwidth memory (HBM) chips, a key component of artificial intelligence (AI) technology. “The first quarter is the lowest point of this cycle. The second half will be better than the first for the whole semiconductor industry and for GlobalWafers,” chairwoman Doris Hsu (徐秀蘭) said during an online investors’ conference. “HBM would definitely be the key growth driver in the second half,” Hsu said. “That is our big hope
The consumer price index (CPI) last month eased to 1.95 percent, below the central bank’s 2 percent target, as food and entertainment cost increases decelerated, helped by stable egg prices, the Directorate-General of Budget, Accounting and Statistics (DGBAS) said yesterday. The slowdown bucked predictions by policymakers and academics that inflationary pressures would build up following double-digit electricity rate hikes on April 1. “The latest CPI data came after the cost of eating out and rent grew moderately amid mixed international raw material prices,” DGBAS official Tsao Chih-hung (曹志弘) told a news conference in Taipei. The central bank in March raised interest rates by