Olympus Lawsuit Boosts Its Stocks by 30 Percent

By siliconindia   |   Wednesday, 11 January 2012, 01:27 IST
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In July 2011, Olympus occupied a market share of 38.7 percent, in the category of mirror-less cameras, leaving behind big brands like – Samsung, Sony and Panasonic. Shares of Olympus increased by 30 percent this year due to the lawsuit being filed by it. Since, quite a few of the top management executives are being charged with the lawsuit, Olympus is headed towards corporate restructuring. This has strengthened the faith of investors in Olympus, indicating the rise in stock prices. Given the present condition of the company, Olympus is in dire need of funding from other organizations. A few companies which seem interested in Olympus are – Sony, Panasonic, Fujifilm and Hoya. According to Ryosuke Okazaki, Director at ITC Investment Partners Corp., said, "Investors who have been holding short positions are buying them back heavily. Also investors may be allocating funds into Olympus due to the expectation that the company will have a new governance." Tokyo Stock Exchange is deciding to keep Olympus in the stock market, under the "security on alert" bracket and this will aid Olympus to be traded on the stock exchange till the condition of its internal management is cured. Okazaki added, "Investors are welcoming the move that Olympus shares will remain listed." He further said, "As Olympus shares are likely to be remain listed, investors are now eyeing the company to be in the target of M&A. In this kind of mood, shares are being bought back heavily today."

This accounting scandal has exposed Japan’s incapable corporate governance, which seems to be adversely affecting the decisions of investors to select Japan as an overall investment domain option.