Japan's Livedoor said today that it has replaced Takafumi Horie as its president a day after he was arrested on suspicion of breaking securities laws.
Kozo Hiramatsu, 60, a Livedoor executive and president of Livedoor's accounting software unit, Yayoi Company, became president today, but the company has not named a replacement for Horie as chief executive, a company spokesman said.
Horie, 33, would remain a director for now, since Livedoor has not received his resignation from that post, but he will not have the right to represent the company, the spokesman added.
At a late night news conference, new president Hiramatsu said he had yet to map out a business strategy.
Fumito Kumagai, director with new rights to represent the company, said Livedoor had no plans to be taken over and that its finances were sound.
In a separate announcement, Livedoor restated its interim earnings results for the six months to March 31, 2005, slashing cash flow from operations by nearly 90% to 1.15 billion yen ($10m) and shifting it to cash flow from investment.
Expecting heavy trading in the Internet firm's stock, which had been placed under watch for possible delisting, the Tokyo Stock Exchange said it would shorten trading hours in Livedoor shares from tomorrow to ease the burden on its computer systems. Trading in Livedoor will be allowed only between 1.30pm and 3pm (Japanese time) from Wednesday.
The measure, which a TSE official said is a first for the bourse, will last for the foreseeable future. The exchange also said it could suspend trading in the stock, depending on trading volume.
It has been delaying the opening of its afternoon session for all stocks by 30 minutes, since a flood of sell orders threatened to overwhelm its computer systems last Wednesday.
Horie and three other executives were arrested yesterday on suspicion of spreading false information to manipulate share prices. A raid on Livedoor by authorities a week ago sparked chaos on the Tokyo stock market and sent share prices plunging across the board on huge volume.
Livedoor, a patchwork of 50 online retail and financial properties acquired by Horie in a heated 10-year expansion, has lost about three-quarters of its $6 billion market value since prosecutors raided its headquarters and Horie's home on January 16.
