Olympus Corp.’s (TYO:7733) former CEO, Michael Woodford, is abandoning his quest to regain the top seat at the Japanese endoscopy giant, saying he plans to sue for wrongful termination.
Woodford, Olympus’ first and only non-Japanese CEO, was ousted after only 2 weeks on the job after he blew the whistle on a decades-long accounting scandal late last year.
The jilted executive resigned from the Olympus board and called for the wholesale ouster of its directors. Woodford tried to put together a coalition of stakeholders to wrest control of the company from its current managers.
But he’s since given up on returning to the helm, due to a lack of support from Japanese institutional investors, he told a news conference at the Japan National Press Club in Tokyo.
"Despite one of the biggest scandals in history, Japanese institutional investors have not spoken one single word of criticism, in complete and utter contrast to overseas shareholders who are demanding accountability from directors," Woodford said.
He added that he will "most definitely" sue Olympus for wrongful termination, accusing the company of firing him without legal basis, the Wall Street Journal reported..
Woodford was sacked after questioning a $687 million acquisition consulting fee Olympus paid to 2 advisory companies related to its purchase of Gyrus Group Plc in 2008, more than ⅓ of the $2 billion purchase price. Woodford’s termination Oct. 14 sparked a sell-off of Olympus shares, which lost more than half of their value within a week.
Olympus, which has a corner on 70% of the endoscopic camera market, launched an internal probe into the fee scandal after Woodford took his concerns to the media, the U.K.’s Serious Fraud Office and the FBI.
Early in November 2011, the company admitted to channeling money through investment funds to hide its investment losses. The technology titan revealed that nearly $1.7 billion in possibly illegal payments were used to conceal the losses over the last two decades.
Shares of Olympus stock were trading up 2%, at ¥1,053 (≈$13.66), as of about 10:30 a.m. today, still a far cry from their ¥2,482 (≈$32.19) closing price the day before Woodford was sacked.