(Tokyo, JPN) - Japan's scandal-hit Olympus said Thursday former chief executive Michael Woodford has quit the company's board, but reports said he was working on an "alternative plan" for managing the company.
"We announce that the company received a resignation letter from board director Michael Woodford today and that he resigned as company board director as of today," Olympus said in a brief statement.
Woodford said he was resigning because the current board was not fit to carry out its promises of cleaning up Olympus after expensive acquisition deals were used to mask investment losses dating back over two decades.
"The promise for reform or reconstruction by (Olympus president Shuichi Takayama) and the current board carries little or no credibility and is continuing to harm Olympus and its long-term future," Woodford said in a statement, according to Dow Jones Newswires.
"Following my resignation, I intend to liaise with all interested stakeholders with a view to formulating a proposal for the constitution of a new board," he was quoted as saying.
Dow Jones said Woodford stressed in a telephone interview that he is not "walking away" from the embattled camera and medical equipment maker, and is instead working on his "alternative plan" for managing the firm.
Japan's Kyodo news agency quoted Woodford as saying he would wage a proxy battle to win shareholder support for the move -- a rare strategy in Japan, where big institutional investors are typically reluctant to go against management with whom they have close ties.
Woodford was dumped on October 14 as the first ever non-Japanese president and chief executive in the firm's nine-decade history, but retained his seat on the board.
He said he had been ousted because he had voiced concerns over high-priced acquisition deals in recent years and alleged serious flaws in corporate governance.
Olympus initially denied any overpayments in the deals, but later admitted funds had been used to hide investment losses dating back to the 1990s.
Some Olympus shareholders and employees have campaigned for Woodford to be reinstated as head of the company.
Local media have reported the company's hidden losses, dating back to the 1990s, as totalling more than 100 billion yen ($1.3 billion), while other reports have pegged the figure as high as $5 billion.
But foreign shareholdings in Olympus have increased in recent weeks as Japanese investors such as Nippon Life Insurance sold their holdings.
Olympus shares rose 5.75 percent at 1,084 yen on the Tokyo Stock Exchange in late morning trade, still less than half their price before Woodford's ouster.
