The former CEO of Olympus Corp, whose suspicions over dubious accounting triggered a scandal at the camera and medical equipment maker, will return to Japan next week to meet with police and authorities investigating the case.

I'll arrive on Wednesday afternoon, Michael Woodford told Reuters by telephone, adding he expected the Japanese authorities to ensure his safety while in the country. Woodford fled Japan after being fired on Oct. 14.

He said he would meet with Japanese police, prosecutors and officials of the Securities and Exchange Surveillance Commission, the Japanese financial market regulator.

Olympus is under investigation by police, prosecutors and regulators after admitting to hiding investment losses for decades and using payments linked to acquisitions to aid the coverup.

Olympus' top shareholder, Nippon Life Insurance, has cut its stake in the Japanese firm, but will remain an investor as it believes the company has a strong core business and technology.

The company said it aims to more than halve its long-term debt to around 222 billion yen ($2.88 billion) by March 2017.

The Nikkei business daily said earlier Olympus may sell assets to help pay down $3.4 billion in debt under a plan aimed at keeping the support of its banks. Their backing is vital because the firm is relatively highly geared and is expected to have to make some hefty writedowns after its accounts are put straight.

Nippon Life, said it had cut its holding to 5.11 percent from 8.18 percent due to uncertainties swirling around the company, but would still back the firm.

Our basic stance is that we will continue to support Olympus due to the company's high technological strength in its core business and because it is in the public's interest, said Akira Tsuzuki, an official at Nippon Life.

Olympus, which employs nearly 40,000 people, is the global leader in endoscopes, and its optical technology may have defense applications.

The once-proud company, established shortly after World War I, offered at a meeting with creditors on Wednesday to cut its debt by about 260 billion yen ($3.4 billion) over the next three years, the Nikkei said. It quoted a senior banker as saying Olympus did not face any imminent cash crunch.

Katsunori Nagayasu, chairman of the Japanese Bankers Association and president of Mitsubishi UFJ Financial Group, the country's biggest bank, told reporters Thursday it was the responsibility of main creditors to show support for a company in trouble.

But, if a company is found to have problems, like the involvement of anti-social forces, banks are not able to give support, he said.

Media have speculated that anti-social forces -- code for organized crime -- might somehow be involved in Olympus' dubious deals. The company's new president has said he was unaware of any such thing.

DUBIOUS PAYMENTS

The dubious M&A payments included a $687 million fee paid to obscure financial advisers for Olympus's $2.2 billion purchase of British medical equipment firm Gyrus in 2008. The fee is the world's biggest, according to Thomson Reuters data.

Shares in Olympus, which have lost 70 percent of their value since the scandal broke last month, see-sawed in heavy trade on Thursday, surging by as much as 18 percent then giving up almost all those gains to end 0.95 percent up at 747 yen.

Investors are betting the firm will keep its coveted Tokyo Stock Exchange listing, though executives deemed responsible for the scandal may face criminal charges.

Fumiyuki Nakanishi, strategist at SMBC Friend Securities, said banks were major shareholders as well as lenders to Olympus and none would benefit from a delisting, which would effectively cut the firm off from equity capital markets.

The big shareholders are the banks. They're the ones that are going to suffer if Olympus shares turn into scrap paper, said Nakanishi, noting Olympus still needed to meet a December deadline for publishing its half-year accounts.

If Olympus does hand in its results by Dec. 14, and there are no further uncertainties, the stock will continue its climb on a view that it will not be taken off the Nikkei 225 or be delisted.

TO DELIST, OR NOT?

Olympus shares are on a watchlist as a possible prelude to delisting, which would be automatic if it misses the December 14 deadline. The company on Thursday reaffirmed that it would announce its earnings by that date.

The bourse can still delist the shares depending on the scope of past misstatements. But a securities watchdog source has said it might recommend the company be fined, a move that could decrease the risk of delisting.

Institutions and funds are selling their Olympus holdings, but as long as the company looks as if it might avoid delisting, hedge funds and speculator traders will keep buying it back, looking for short-term gains, said Masayoshi Okamoto, head of dealing at Jujiya Securities.

But, he added, the rising trend could turn around quickly if the company looked like it might miss the deadline.

In a sign that Olympus expects its core businesses to keep ticking over, the company showed creditors a tentative operating profit forecast of 35.6 billion yen for the year to March, the Nikkei said. That would be significantly lower than a previous forecast of 50 billion yen announced in August, but about the same as last year's profit.

Olympus said on Thursday it may need to write down 33.4 billion yen ($434 million) in goodwill costs related to its acquisition of Gyrus. The Nikkei reported earlier the company had overstated the cost of the deal by that amount by the end of fiscal 2010. An independent panel commissioned by Olympus is still looking into this.

If this were the only writedown, such an amount would put a big dent in the company's equity, but not destroy it.

At Wednesday's meeting, which involved about 100 bankers, two major creditors -- Sumitomo Mitsui Banking Corp and Bank of Tokyo-Mitsubishi UFJ (BTMU) -- said they would continue to support the firm, multiple sources told Reuters.

Olympus' interest-bearing debts were about 650 billion yen ($8.45 billion) on a consolidated basis as of end-March. The two banks have total loans of over 400 billion yen to the firm, which also borrowed about 100 billion yen in syndicated loans, according to banking sources.

($1 = 76.950 Japanese Yen)

(Additional reporting by Mari Saito, Yoko Kubota, Lisa Twaronite, Tim Kelly and Isabel Reynolds in Tokyo; Writing by Linda Sieg; Editing by Mark Bendeich and Ian Geoghegan)