Nidec Shares Fall After Tokyo Exchange Calls for Internal Controls Improvement — Update

By Kosaku Narioka

Nidec Corp. shares tumbled after the Tokyo Stock Exchange said the company would need to improve internal controls following suspected accounting irregularities, placing the stock on special alert.

Shares were recently down the daily limit, falling 19% to 2,070.5 yen, equivalent to $13.54, in Tokyo trading Tuesday.

The bourse operator said Monday that the Japanese maker of electric motors and other equipment would need to improve controls after its auditor declined to issue an opinion on Nidec's financial statements for the fiscal year ended March, citing ongoing investigations into accounting issues.

The exchange designated the stock as a security on special alert on Tuesday. A failure to improve internal controls could eventually lead to delisting.

Nidec will be removed from the Nikkei Stock Average on Nov. 5 as a result, according to the index publisher Nikkei Inc., which said electronics maker Ibiden will replace it.

The Kyoto-based company said Tuesday that it would fully cooperate with the investigations and strengthen governance and internal controls to restore investor confidence.

Nidec formed a third-party committee in September to investigate potential cases of improper accounting. Earlier probes uncovered documents suggesting practices such as arbitrary changes to the timing of asset write-downs.

The company this month withdrew its earnings forecasts and said it wouldn't pay an interim dividend due to the ongoing investigations. It also canceled a share buyback program announced in May.

Write to Kosaku Narioka at kosaku.narioka@wsj.com

(END) Dow Jones Newswires

October 27, 2025 23:07 ET (03:07 GMT)