Sony and Olympus have received all regulatory approvals necessary to establish a joint medical venture.
For Sony, the enterprise provides the chance to diversify in the face of the stalling plasma TV market. For Olympus, the deal gives the camera and medical device maker a shot at redemption after a major financial fraud cover-up.
Olympus cameras will also benefit from Sony's technological enhancements.
The joint venture was first announced in September 2012. Sony was given an 11-percent stake in Olympus for a sum of 50 billion yen ($535 million). The two companies wanted to take their new medical venture public on April 1, but sources say that a Chinese industry watchdog stalled the process and forced them to delay the launch.
Olympus currently owns a 70-percent share of the worldwide medical endoscope market. Endoscopes are cameras attached to long tubes used to take internal images of the human body.
For example, when someone has a colonoscopy, a colonoscope, which is a type of endoscope, is passed into the colon so that doctors can see any evidence of colon cancer development.
Laparoscopes are another type of endoscope used in minimally invasive laparoscopic surgery. A laparoscopic surgery to remove the gall bladder, for instance, uses small incisions into which a laparoscope is inserted to guide the surgeon's movements.
Laparoscopic minimizes bleeding and allows patients to recover more quickly.
Olympus had to pay a fine of 1 billion yen ($10.6 million) for a financial scandal in which its executives were accused of covering up more than $1.7 billion in losses over a span of nearly a decade. In 2011, when British national Michael Woodford became Olympus's first foreign head, he began asking questions that resulted in his abrupt termination.
After Woodford was fired, financial authorities in the U.S., the U.K. and Japan started to investigate Olympus. Only then did the company start to fire executives who had participated in the cover-up.
Woodford settled a wrongful termination lawsuit with Olympus for $15.6 million.
Chinese regulators may have become involved in blocking the venture because of a territorial dispute between the mainland and Japan. A land dispute over an island chain has triggered protests in China and a boycott of Japanese goods.
Edited by
Braden Becker
