Olympus settles with ex-chief Woodford

Former Olympus president Micahel Woodford arrives at a seminar in Tokyo on November 24.

Story highlights

  • Michael Woodford reached an out-of-court settlement with Olympus for unfair dismissal
  • Former chief executive was fired after raising questions about $1bn in suspicious payments
  • Woodford would receive the pay for the remainder of his contract, which could be worth £10m
  • The company lost nearly 80% of its market value at the height of the accounting scandal

Michael Woodford, the former Olympus chief executive, has reached an out-of-court settlement with the Japanese company for unfair dismissal.

Mr Woodford was sacked just two weeks into his tenure after he raised questions about $1bn in suspicious payments made by the optical equipment maker.

Terms of the settlement were not immediately disclosed, but it was expected that Mr Woodford would receive the pay he was entitled to for the remainder of his contract, which could be worth £10m.

The start of the tribunal in east London had been delayed until Tuesday to allow further negotiations. The deal is subject to ratification by Olympus's board, which meets on June 8. If the board does not ratify the deal, the case will be reopened.

Speaking after the tribunal, Mr Woodford said: "Hopefully today is closure. A line has been drawn and the company can move on -- and I can too.

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"We think [the potential settlement] is positive and in the interests of both parties. I genuinely hope that, in the interests of Olympus, it helps them move forward."

Mr Woodford declined to comment on whether the settlement would be ratified or to reveal the terms of the deal.

"Today, I just want to leave it at that," he said. "It's hopefully the end of this. It's important that the company moves on with the new board -- and that I and my family, my wife and children, move on. Both parties need to move on and my involvement come to a close."

Mr Woodford had previously made clear that he would not agree to a settlement that prevented him from speaking publicly about his time at Olympus.

The Liverpool-born chief executive initially campaigned to be reinstated as chief executive following his dismissal, before announcing plans to take legal action against Olympus in January.

Since his disclosures, Olympus's board has been partially replaced and the accounting scandal has been investigated by a number of bodies, including the UK Serious Fraud Office and the US Federal Bureau of Investigation.

Olympus's share price fell by more than 80 per cent in the wake of the scandal and is still half its pre-scandal level.

After initially denying wrongdoing, Olympus admitted that it had been stashing lossmaking securities investments in the Cayman Islands and other offshore centres since the early 1990s.

The acquisitions, for which Olympus intentionally overpaid, had been part of a complex scheme to square its accounts. In February, seven people were arrested in connection with the fraud.

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