Daily Archives: January 24, 2006

The Harder They Fall

Livedoor CEO Horie Takafumi (33) was arrested yesterday evening along with three other company executives. The golden boy of the Japanese IT industry had been denying any knowledge of his company’s financial misdeeds right up until the end. Investigators from the Tokyo District Public Prosecutors Office have been looking into the firm’s creative bookkeeping for the last few months, but a drastic slide in Livedoor’s shares in the last week, accompanied by a big drop in the Nikkei Stock Average, led them to go straight to the top and question Horie yesterday. His arrest and transportation to the Tokyo Detention House was covered live on several TV channels. The whole affair has happened so quickly – less than two weeks ago Horie was still a regular on TV and talking about his planned space tourism business – that it has been labeled the “Livedoor Shock”. The company was started up as Livin’ On The Edge Inc. in 1996 by then Tokyo University student Horie with just ¥6 million in capital. Through a series of aggressive M&A’s and Horiemon’s self-promotion, that valuation rose to over ¥730 billion just a week ago. The firm’s stock price has fallen from ¥696 on January 16 to ¥256 when the market closed yesterday. Also arrested yesterday were Horie’s right-hand man and Livedoor CFO Miyauchi Ryoji, Livedoor Marketing President Okamoto Fumito, and Livedoor Finance President Nakamura Osanari. Another top executive, Noguchi Hideaki, commited suicide in Okinawa last Wednesday.