The former British CEO of Japan's scandal-ridden Olympus Corp called on its disgraced board on Wednesday to make way for his return to the top job, as the firm faced a make-or-break deadline to iron out its crooked accounts.

The maker of cameras and medical equipment, engulfed by a $1.7 billion (1 billion pounds) accounting fraud, one of Japan's worst corporate scandals, must meet a Wednesday deadline to file its second quarter earnings or be delisted from the Tokyo Stock Exchange.

It also plans to submit revised accounts for past years.

Delisting would cut Olympus off from equity capital markets, putting it under pressure to sell core assets and marking a humiliating low for the 92-year-old firm, which two months ago triggered the crisis by sacking its CEO, Michael Woodford.

Woodford immediately blew the whistle on the firm's accounting problems after he was fired and is now waging a campaign to be reinstated, appealing to shareholders to support his comeback as part of a complete renewal of the board.

The board has committed to resigning over the scandal, but wants to choose its own successors before quitting, setting up the prospect of a proxy war between its own candidates and those being assembled by Woodford as part of his campaign.

The shareholding balance is such that there is a realistic chance we could win a proxy fight, Woodford said. But he added that such a battle would cause a split between foreign and Japanese shareholders and that he hoped it could be avoided.

Some big foreign shareholders back Woodford's bid but Japanese institutional investors, although reticent, appear worried about whether he can win over the company's employees as well as his plans to turn around the once-proud firm.

Woodford said he was willing to meet Olympus President Shuichi Takayama at any time but added incumbent directors were too discredited to be in a position to choose their successors.

Woodford, who was a rare foreign CEO in Japan, also sought to soothe concerns about his plans to restore trust in Olympus.

I want no part in selling Olympus or breaking it up, he said, adding he would not close down the firm's struggling camera business.

People say the 'gaijin' president would shut it, Woodford said, using the Japanese word for foreigner. I wouldn't.

Analysts have said Olympus' big and profitable medical business could be bought by a rival or private equity if it became clear the firm could no longer effectively run it.


Investors poring over Olympus' financial statements later on Wednesday will be looking for the scale of changes to its balance sheet and whether it will need to raise fresh equity, as well as whether auditing firms KPMG AZSA LLC and Ernst & Young ShinNihon LLC will sign off on the financial documents.

The Nikkei daily said Olympus' ex-auditor, KPMG AZSA, would give qualified approval to restated accounts for the three years to March 2009, with the qualification based on factors such as the auditor's inability to completely confirm money flows.

Ernst & Young ShinNihon would approve without qualifications all statements for periods from March 2010, the newspaper added.

Olympus shares at one point lost more than 80 percent of their value after the scandal broke in October.

Since then, an outside panel commissioned by Olympus to probe the scandal has found that the deals were part of a fraud carried out by a few executives to hide losses stemming from risky securities investments in the late 1980s. Some of these losses were disguised in the accounts as acquisition payments.

The panel found no evidence of rumoured involvement by organised crime syndicates in the scheme, although Olympus remains under investigation by police, prosecutors and regulators, who are expected to step up their joint probe after the revised financial statements are announced.

Olympus shares have rallied from their lows in recent weeks on expectations that while some former executives face harsh punishment, the firm itself will avoid a delisting.

Now at about half its pre-scandal value, the stock last traded down 2 percent at 1,343 yen.

(Additional reporting by Chikafumi Hodo and James Topham; Editing by Mark Bendeich)