End of an Era - Olympus to sell camera division

Way back in college, I cut my teeth with my first camera, which was a second-hand Olympus.  I can't even remember the model number, but I remember taking my first pictures with it to this day. I was hooked.  It wasn't until much later that I moved over to Canon and the EOS-3.

Olympus has sadly announced that it's selling off its camera division.  While we don't usually report on the profitability of the other camera companies, we have been watching with alarm at some of the financials of some of the companies - notably Olympus for some years now.  Their cameras are amazing high tech marvels, and they have led the pace of innovation in the industry for many years.  I can't quite pin why they didn't do well, perhaps a combination of the sensor size, and I don't think they managed to capture the soul of their film cameras.  Regardless of the reasons, they have been struggling for more than a few years.

I think this hurts the industry as Olympus helped spearhead the technological development of cameras.

• half frame camera system - the precursor to crop sensors.
• TTL direct light metering system
• fully automatic waterproof camera
• dust reduction system
• live view
• Art Filters
• 5 axis image stabilization
• in-camera perspective control
• in-camera long exposure (live bulb)
• pixel shift

and I'm sure many other innovations.  We can hope that JIP (Japan Industrial Partners) will keep the Olympus / Zuiko brand afloat and continue to make mirrorless cameras, but it's unknown if they will simply focus on more business to business and industrial applications at this time.

The Olympus press release is below;

Signing of Memorandum of Understanding for Divestiture of Imaging Business

Olympus Corporation ("Olympus") and Japan Industrial Partners, Inc. ("JIP") hereby announce that, today,
the parties signed a memorandum of understanding to carveout Olympus’s Imaging business to a new company
(“NewCo”) and subsequently transfer its shares to a fund managed, operated or otherwise handled by JIP (the
"Transaction").
After the due diligence and further discussions and negotiations, the parties are aiming to sign a legallybinding definitive agreement for the Transaction (the "Definitive Agreement") by September 30, 2020. We will promptly make further announcement if any matters relating to the Transaction that needs further announcement
occur.

1. Background and Purpose of the Transaction
Olympus's Imaging business began with the manufacture and sale of a camera using the photographic
lens Zuiko in 1936. Through innovative technology and unique product development capabilities, Olympus
has developed and launched various products, aiming to contribute to make people’s lives more fulfilling.
Those products include: Olympus Pen, the innovative half-sized camera; Zuiko Pearlcorder, the world's
first micro-cassette tape recorder; and Olympus OM-D series, the mirrorless interchangeable lens camera.
Olympus has implemented measures to cope with the extremely severe digital camera market, due to,
amongst others, rapid market shrink caused by the evolution of smartphones; Olympus has improved the
cost structure by restructuring the manufacturing bases and focusing on high-value-added interchangeable
lenses, aiming to rectify the earning structure to those that may continue generating profit even as sales
dwindles. Despite all such efforts, Olympus’s Imaging business recorded operating losses for 3 consecutive
fiscal years up to the term ended in March 2020.
Under such circumstances, Olympus considers that, by carving-out the Imaging business and by
operating the business with JIP, the Imaging business’s corporate structure may become more compact,
efficient and agile and it is the most appropriate way to realize its self-sustainable and continuous growth
and to bring values to the users of our products as well as our employees working in the Imaging business.
Olympus therefore has decided to sign the memorandum of understanding for the Transaction.

JIP has strong track records in supporting strategic carve-outs that realize growth potential and
encourage autonomous growth. By adding support from JIP, the NewCo, as the successor of reputable
brands such as “OM-D” and “ZUIKO,” will utilize the innovative technology and unique product
development capabilities which have been developed within Olympus, and will realize continuous
growth of the business by bringing better products and services to the users and customers and by
making itself a productive and rewarding work place for its employees.

2. Imaging Business after the Transaction

NewCo will succeed and maintain the research and development functions and manufacturing functions
globally as reformed under the contemplated structuring reforms to continue to offer high-quality, highly
reliable products; and also continue to provide supports to the imaging solution products that have been
distributed by Olympus.

3. Outline of the Transaction

The specifics of the Transaction shall be decided in the Definitive Agreement after careful examination
and consultation between the parties. The parties currently consider the outline of the Transaction shall be
as follows.
The parties will proceed with the actions and procedures for Transactions in full compliance with
applicable laws including consultation obligations and other requirements under local employment laws.
(1) Structure : (i) Olympus’s Imaging business will be transferred to the NewCo by way of
company split or otherwise, and then, (ii) shares in the NewCo will be
transferred to a new company to be established by JIP.
(2) Signing of
Definitive Agreement
: Scheduled to be signed by September 30, 2020
(3) Closing : Olympus and JIP strive to close the Transaction by December 31, 2020.

4. Structuring Reform

Prior to the closing of the Transaction, Olympus plans to implement structuring reforms to the Imaging
business aiming to change the business structure of Imaging business to be more profitable and sustainable.
We are currently investigating costs and other impacts of the structuring reform. If any future event which
requires disclosure arises, Olympus will announce it promptly.

Contact:
Olympus Corporation, Investor Relations: TEL．03-3340-2111
Japan Industrial Partners, Inc.: TEL．03-6266-5781

• Olympus