July 01, 2010

Fuji Xerox cuts sumo sponsorship amid betting scandal

Fuji Xerox became at least the fifth company to pull its sponsorship of Japan’s sumo wrestlers as the sport’s governing authority battles to stem the fallout of a betting scandal.

Japan’s biggest maker of color copiers yesterday canceled prizes for winning wrestlers worth 540,000 yen ($6,100) for a tournament scheduled to begin July 11 in Nagoya, central Japan. It follows decisions by Nagatanien Co., Asahi Mutual Life Insurance Co., IHI Corp. and Natori Co. not to sponsor the event.

Japan’s sumo association this week suspended Chairman Musashigawa and 13 wrestlers after some members admitted to illegal gambling on baseball matches. Organizers are protecting $96 million in tournament sales and guarding against damage to a sport already hurt by allegations of assault, trainee abuse and drug use.

“The association is paying for its failure to take adequate measures to address various incidents in the past,” Sports Minister Tatsuo Kawabata told reporters in Tokyo June 29. “The fate of sumo, with a long history, hinges on efforts by the association from now on.”
Kawabata said he was concerned about links between the sport and organized crime, including allegations that stablemasters gave front-row tournament tickets to gangsters.

An investigative panel commissioned by the association has recommended that at least two members be expelled for their involvement in gambling.

The association should replace Chairman Musashigawa with someone able to remove the influence of “socially threatening groups,” panel member Shigeru Ito told reporters on June 27.

Fuji Xerox, a unit of Fujifilm Holdings Corp., has provided 9 prizes at each tournament held this year. Each prize is worth 60,000 yen, with the majority of the funds going to the winning wrestlers. Sponsors can provide multiple prizes per bout, and their names are displayed on banners carried around the ring and read out before matches.

Fujifilm, which owns a 75 percent stake in Fuji Xerox, declined 1.7 percent to 2,545 yen at the 3 p.m. close on the Tokyo Stock Exchange. IHI dropped 2.1 percent to 140 yen. The benchmark Topix index fell 1.6 percent.

“We judged there is a social impact” from the involvement of wrestlers and stablemasters in gambling, Fuji Xerox spokesman Masaaki Bando said today.

IHI’s boilermaker unit also decided to cancel its 12 prizes at the Nagoya tournament, spokesman Keiichi Sakamoto said by phone today.

The sumo association has no comment to make on the withdrawal of sponsors, a spokeswoman, who declined to provide her name, said yesterday.

Asahi Broadcasting Aomori Co. this week canceled a plan to hold a one-day sumo tournament in August because of the controversy.

Public broadcaster NHK, which has aired every major tournament since 1953, has said it may cancel coverage of the Nagoya event unless the association takes “sufficient” measures to address the gambling issue.

The sumo association forecasts annual sales of about 8.53 billion yen this year from six tournaments, according to a report on its website.

Morinaga & Co. may also cancel its award, which is given in a tournament in September, spokeswoman Kaoru Nakamura said today.

McDonald’s Holdings Co. Japan isn’t considering canceling its sponsorship, said spokesman Kazuyuki Hagiwara today. The burger chain installed a custom-made seat to support the weight of wrestlers at its restaurant near Tokyo’s sumo stadium after it started sponsoring the sport last year.

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