Corrected: Hitachi Chemical hit by new falsification scandal, shares slump

Image
Reuters TOKYO
Last Updated : Oct 29 2018 | 10:30 AM IST

(Corrects last paragraph to say bourse warns investors, not company)

TOKYO (Reuters) - Hitachi Chemical Co has told customers it falsified inspections for a material used in semiconductors, an industry source familiar with the matter said, the latest in a run of compliance scandals at Japanese firms and the company's second this year.

Shares in Hitachi Chemical fell about 10 percent by mid-morning on Monday, losing more than 30 billion yen ($268 million) in market value.

The source, who is not authorised to speak to media on the matter and declined to be identified, said the Hitachi Ltd unit recently notified customers of improper tests.

Local media reported over the weekend that the material, which is used to protect semiconductors from scratches and debris, is used in a wide range of products such as computers and other electronic devices.

The company said in a statement on Saturday that a committee of external experts was investigating the issue and would announce the results as soon as they were available.

The revelations follow Hitachi Chemical's admission in June that it found data falsification in quality tests of lead-acid batteries for industrial use over a period of more than seven years, affecting some 60,000 products shipped to roughly 500 companies.

Other recent compliance failings at Japanese manufacturers include scandals at Kobe Steel Ltd, Nissan Motor Co Ltd and Subaru Corp.

The Tokyo Stock Exchange on Monday issued a warning to investors, citing a lack of clarity around the Hitachi Chemical issue.

($1 = 111.8200 yen)

(Reporting by Makiko Yamazaki, Naomi Tajitsu and Chang-Ran Kim; Writing by Ritsuko Ando; Editing by Edwina Gibbs)

Disclaimer: No Business Standard Journalist was involved in creation of this content

*Subscribe to Business Standard digital and get complimentary access to The New York Times

Smart Quarterly

₹900

3 Months

₹300/Month

SAVE 25%

Smart Essential

₹2,700

1 Year

₹225/Month

SAVE 46%
*Complimentary New York Times access for the 2nd year will be given after 12 months

Super Saver

₹3,900

2 Years

₹162/Month

Subscribe

Renews automatically, cancel anytime

Here’s what’s included in our digital subscription plans

Exclusive premium stories online

  • Over 30 premium stories daily, handpicked by our editors

Complimentary Access to The New York Times

  • News, Games, Cooking, Audio, Wirecutter & The Athletic

Business Standard Epaper

  • Digital replica of our daily newspaper — with options to read, save, and share

Curated Newsletters

  • Insights on markets, finance, politics, tech, and more delivered to your inbox

Market Analysis & Investment Insights

  • In-depth market analysis & insights with access to The Smart Investor

Archives

  • Repository of articles and publications dating back to 1997

Ad-free Reading

  • Uninterrupted reading experience with no advertisements

Seamless Access Across All Devices

  • Access Business Standard across devices — mobile, tablet, or PC, via web or app

More From This Section

First Published: Oct 29 2018 | 10:15 AM IST

Next Story