Olympus Corp. Tells Lenders Cash Crunch Looms: Report

 @ibtimes on December 16 2011 11:42 PM
Olympus Corp's digital camera is seen through a show window which bears rain drops and reflects lights from traffic at an electronic shop in Tokyo
An Olympus Corp. digital camera is seen through a show window that bears raindrops and reflects lights from traffic at an electronics shop in Tokyo on Dec. 6. REUTERS

Japan's disgraced Olympus Corp, whose balance sheet took a massive hit after it admitted to a long-running accounting cover-up, told lenders its cash and deposits could run out in 2015, a newspaper reported on Saturday.

Senior officials from the company met lenders on Friday, telling them they would come up with a new business plan in early May that could include equity tie-ups to bolster its balance sheet.

The company's main lender, Sumitomo Mitsui Banking Corp., agreed at the meeting to continue its support for the company, a source told Reuters.

Assuming no new long-term borrowing, the company said cash and deposits would fall to 183.7 billion yen ($2.36 billion) at the end of March 2013 and 94.2 billion yen a year after that, the Nikkei business said. Reserves could run out completely in 2015, the paper said.

Olympus's profits on its medical equipment business are hampered by losses on a struggling camera unit.

The company withdrew its full-year earnings forecast on Wednesday, but at Friday's meeting offered an internal forecast for a 7 percent year-on-year decline in sales to 790 billion yen and a 5.6 percent gain in operating profit to 35.6 billion yen.

($1=77.7 yen)

(Reporting by Isabel Reynolds; Editing by Robert Birsel)

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