Tokyo: Scandal-hit Olympus Corp. is considering slashing over 2,500 jobs mainly overseas by consolidating its plants in China, Vietnam and the United States to review the slumping digital camera business, sources familiar with the matter have said. (Agencies)
The company, needing to improve its financial base deteriorated by a loss coverup scandal, is planning to strengthen its medical equipment, digital camera and industrial machinery operations to enhance profitability, while unloading units that are little related to such businesses, the sources said.
The envisaged job cuts will involve about 6 percent of some 40,000 group employees.
The Japanese camera and medical equipment maker aims to incorporate restructuring measures in its business plan to be released possibly in early June, the sources said on Wednesday.
To shore up its financial standing, Olympus is in talks with Panasonic Corp. on forming a capital and business tie-up, in a deal which the Japanese electronics heavyweight could become the largest shareholder in Olympus if it decides to make investments, the sources said.
Besides Panasonic, which is aiming to strengthen its medical equipment business, Sony Corp., Fujifilm Holdings Corp. and Terumo Corp. are candidates to form a business alliance with Olympus.
Olympus plans to make a decision by the end of June, the sources said.
By implementing such measures, Olympus is seeking to raise its consolidated capital adequacy ratio to around 30 percent in the next five years after seeing the ratio fall to 4.6 percent as of the end of March.
As for restructuring of its imaging business where the company is incurring operating losses, Olympus will streamline the business by paring its lineup of digital camera products that are facing particularly stiff price competition, while strengthening its mirrorless interchangeable lens camera lineup.
Its Chinese and Vietnamese plants that are manufacturing digital cameras are expected to be subject to consolidation, while it is also likely to streamline a US production base it has acquired.
Meanwhile, the company will concentrate its management resources on medical equipment such as endoscopes that are mainly produced in domestic factories in such areas as Aomori and Fukushima prefectures, the sources said.
Late last year, Olympus said it had concealed 117.7 billion yen in investment losses dating back to the 1990s.
Former Olympus executives, including former Chairman Tsuyoshi Kikukawa, have been arrested and indicted on suspicion of falsifying financial statements.
Tokyo: Scandal-hit Olympus Corp. is considering slashing over 2,500 jobs mainly overseas by consolidating its plants in China, Vietnam and the United States to review the slumping digital camera business, sources familiar with the matter have said.