Olympus Shareholders Approve All-New Board

Photo: Olympus

An angry, tense, and sometimes contentious shareholders' meeting, convened in the common room of a Tokyo hotel Friday (yesterday in Japan), began with Olympus officials and board members bowing deeply to the shareholders in the traditional Japanese gesture of apology.

All 11 current board members resigned, and were replaced with successors they had picked. Hiroyuki Sasa, 56, is the company's new president. Yasuyuki Kimoto, 63, takes over as Chairman. Kimoto is a former executive at Sumitomo Mitsui Banking Corp, Olympus's main investor. Another banker became a director. Foreign investors feel this is a conflict of interest, worried that the new management will make decisions advantageous to Japanese creditors at the expense of the recovery and long-term viability of the company. Olympus rejected these criticisms, noting that six of the new directors have no connections to the banks.

Former CEO and whistleblower Michael Woodford, who was in attendance, demanded to know why he had been fired. Officials failed to give a substantive answer. Some shareholders still wanted him to resume leadership of the company, but that effort was rebuffed. It is believed that the priority for most shareholders is to see the share price recover.

Three former Olympus officials have been arrested and charged in connection with the scandal, which alleges massive accounting fraud.

Despite the highly unusual tenor of the meeting, described by one newspaper as "raucous," Olympus shares rose 6.4% in the aftermath.

Mike

Disclaimer: Yr. Hmbl. Ed. is a former OM-4T user and has plans to buy an OM-D.

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Original contents copyright 2012 by Michael C. Johnston and/or the bylined author. All Rights Reserved.

Comments

[Ned]

"Disclaimer: Yr. Hmbl. Ed. is a former OM-4T user and has plans to buy an OM-D".

If he get's his OM-D before the rest of the world then we know there is still funny business going on at Olympus!

[Dennis Ng]

need Michael Woodford to have credibility ... not sure that will happen

[Ken White]

It seems to me that the make up of the board and the desire to raise share prices does not favor the Olympus camera business. I would not be surprised to see it being sold or otherwise segregated from the more profitable businesses in the group. Too bad.

As for OM-D E-M5 (I think that is correct), I have a body on order. In the last year my m4/3 cameras are getting a lot more use than my Canon DSLRs. For the most part the differences in image quality between the camera types are not much of an issue for me.

The weather sealing on the M5 should help in the dusty honky tonk and outdoor venues where I shoot on most weekends. I'm also looking forward to the improvements dynamic range and high ISO capabilities.

[Steve Greenwood]

I'll be getting an OM-D in time, too. But I'd sure be a lot more comfortable with a board that wasn't 'hand picked by the old board'

[Roy]

"All 11 current board members resigned, and were replaced with successors they had picked."
Priceless. Did anyone ask them to roll up their sleeves and trouser legs to check for tattoos?
Roy

[PWL]

Well, we can hope for the best, but I hope the bankers don't "vulturize" a great company, as some fear.

"Disclaimer:Yr.Hmbl. Cmmntr. owns three OM-2ns & lenses and preordered an OM-D".

[Kenneth Tanaka]

It's the only action that would have been acceptable. (If only a few American companies would also clean-sweep!) And, no, Woodford needs to also move on to afford a genuinely fresh start.

(OT: I ultimately decided to pass on the E-M5 and cancelled my pre-order.)

[MarkB]

Ah... the downward spiral of another "once-great company" continues. If you were a longtime Kodak consumer, the drill should be familiar. Get your products while you can, but there won't be a support network in a few short years.

[Roberto M.]

"Foreign investors feel this is a conflict of interest, worried that the new management will make decisions advantageous to Japanese creditors at the expense of the recovery and long-term viability of the company."

Could it be that foreign investors are looking at the situation with foreign values and foreign cultural expectations?

Just about everything 'known' with respect to the theory of corporate governance and regulation has been violated by Olympus and its creditors and regulators in Japan. But let's face it, had this happened in the us or europe, Olympus would not have lasted a week after the scandal broke. Everyone would have lost - shareholders, employees, consumers, taxpayers, etc.

Perhaps I am naive (and it wouldn't be the first time), but it appears that the Japanese see value in working together to save a once honorable company. Maybe it won't work out and maybe the Japanese banks are only in it for themselves as the foreigners think, but I would sure like to see what happens over time. We know what happens with the non-foreign 'right' way to handle these scandals (Enron).

I guess I should disclaim the fact that I've always liked Olympus, especially the 'marches to the beat of a different drum' nature of the company.

[Miserere]

#1: What a great photo for the article. Kudos to the anonymous Olympus employee that took it.

#2: Mike, please don't call it "OM-D" unless you are not referring specifically to the E-M5 and saying that you will eventually buy an Olympus camera of the OM-D range. Saying you're buying an OM-D is like saying you're buying a Nikon DSLR; it gives some information (you're buying a Nikon, and not a P&S or mirrorless) but it's not specific enough (you could be spending $600 on an entry-level model or $8,000 on the top dog).

Sorry to be annoying, it's just one of my peeves.

[AndrewG NY]

Is this a demo of their new 'foreground blur' "Art" filter?

[Manuel]

Let's just hope things get better. I'd hate to see Olympus Imaging Co. being sold to a company that would dismantle it, like Sony did to Minolta.
I'm not buying the OM-D. For the time I'll be keeping my E-P1, which recently passed the large print test with flying colours!

[Peter Gilbert]

@Roy: The standard method to check for Yakusa is to take a bath with them - then any tattoos are obvious. Maybe a finger or two missing also.

This is playing out just as I thought - the shareholder banks are running the show and will soon pick a company to take over whatever part of the Olympus business they want to divest.

[James B]

Being pessimistic, and assuming some form of "value realisation" by the new board of what is essentially a medical instruments company, who'll buy the camera division?

I'd like to have thought Nikon, but that seems unlikely with their own sub-DSLR interchangeable lens cameras.

Canon? They've got nothing in that segment.

[Bruce]

We received 6 OM-Ds in our retail shop in Melbourne on Thursday, only 2 with 12-50's -all black, and they were gone that day. Bloke came in looking for a (long -time-unavailable) NEX 7 and walked out with the OM-D. It is GORGEOUS, and smaller than it appears on line- I usually get to play with the new toys, but I didn't get any chance -dunno when the next lot are coming!!!!You will love it, Mike!

[Derek Lyons]

"All 11 current board members resigned, and were replaced with successors they had picked."

Not positive news, it smacks of replacing the foxes down at the hen house with coyotes. With that and nearly half of the new board being representatives of the banks...

[Ed]

I could not agree more Mike!

Greetings, ED

[bt]

I once owned an OM-1, I was in high school at the time. I sold it to an acquaintance, along with a few lenses, 28mm, 100mm, 200mm, an odd set of glass.

I never missed a camera more than than that one. Just a marvelous object.

So I always root for Olympus, even now, all of these years later.

[Barb]

I sold my Canon kit - a 5D classic and about 16 lenses (including a big bunch of "L"s)and just received my OMD E-M5 w/grip on April 16. I have the black version with the 12-50mm (my new walk-about lens!) and I couldn't be happier. It is light weight and has a great IQ - I take it everywhere. I couldn't do that with my Canon, which was way too heavy and new versions way too expensive. Photography is fun again and I am still getting the quality images I did with the 5D. I have my whole kit in one little bag - a 20 1.7, 12 2.0, 45 1.8, Rokinon fisheye, 12-50, and the 40-150. Smartest thing I did so far this year. WooHoo!