Japan's Fujifilm Holdings said on January 18 it is considering supporting scandal-hit endoscope maker Olympus Corp although neither side looks likely to move quickly on an equity alliance that Olympus needs to shore up its finances.
A $1.7 billion accounting fraud has severely depleted Olympus' net assets, but it is being supported by major Japanese shareholders who prefer bringing in an equity partner to selling the whole company or its assets.
Its flexible diagnostic endoscope business, which boasts a 70 percent market share, is seen as a jewel of profitability in Japan's lacklustre electronics industry.
"We can only say at this stage that we are considering supporting Olympus," Fujifilm President Shigetaka Komori told Reuters in an interview.
"There would be synergies in the endoscope field...It is a given that any company with a medical business would be interested." Fujifilm, along with Sony Corp and Panasonic, is among firms that media reports and market talk have put into the frame as potential partners for Olympus, although Olympus' president, Shuichi Takayama, said that his company had not been in specific talks with any of those firms.
An equity investment in Olympus by Fujifilm, which holds about 10 to 15 percent of the global diagnostic endoscope market, could trigger a review by Japan's antimonopoly watchdog, the Fair Trade Commission.
Takayama also said Olympus would wait until after a management overhaul in late April to bring in a potential strategic partner. "It is important to improve our equity ratio through measures such as business tie-ups," he told a news conference, noting that the ratio stood at 4.5 percent compared with about 30 percent for its rivals.
"The new team will set the direction for specific tie-ups." Bidders may also be waiting to see what develops in investigations by Japanese police, prosecutors and regulators, as well as by law-enforcement agencies in the United States and Britain.
Takayama, 62, said the current leadership would remain in office for another three months as the company prepared for an extraordinary shareholders meeting in the latter half of April.