Olympus dives 24 percent, hit by payments reports

Mon Oct 17, 2011 6:37am EDT
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By Isabel Reynolds and Tim Kelly

TOKYO (Reuters) - Shares in Olympus Corp plunged by a quarter on Monday after media reports quoted its ousted chief executive of accusing the board of firing him for probing allegations of improper payments related to acquisitions.

Michael Woodford, 51, was sacked just two weeks after the company promoted the Briton from his role as president with glowing reports on his performance.

Combined with Friday's 18 percent fall, the plunge has wiped out $3.2 billion in market value from the Japanese precision instrument and camera maker.

"The dismissal of the president has shattered equity market expectations of structural reform at the firm," Deutsche analyst Yoshikazu Higurashi wrote in a report.

Japanese boards rarely dismiss top executives, so the announcement took financial markets by surprise.

In an interview with the Wall Street Journal, 30-year Olympus veteran, Woodford, said he had asked the chairman, Tsuyoshi Kikukawa, to resign over serious governance concerns.

Olympus denied any wrongdoing but the sacking triggered a slew of downgrades from brokerages worried about Olympus stepping back from a commitment to cut costs.

"All M&A deals were conducted using appropriate accounting, following appropriate processes," an Olympus spokesman told Reuters.   Continued...

<p>A man walks past a logo of Japanese camera and endoscope maker Olympus Corp at the company's headquarters in Tokyo in this May 17, 2011 file photo. REUTERS/Yuriko Nakao/Files</p>