TOKYO • Japan’s Takata Corp, the firm at the centre of the auto industry’s biggest product recall, has filed for bankruptcy protection in the United States and Japan, and yesterday said it would be bought for US$1.6 billion (S$2.2 billion…
TOKYO • Japan’s Takata Corp, the firm at the centre of the auto industry’s biggest product recall, has filed for bankruptcy protection in the United States and Japan, and yesterday said it would be bought for US$1.6 billion (S$2.2 billion) by US-based rival Key Safety Systems.
Takata chief executive Shigehisa Takada, whose grandfather started the company in 1933 as a textile- maker, said he and top management would resign once the takeover was completed.
In the biggest bankruptcy of a Japanese manufacturer, Takata faces tens of billions of dollars in costs and liabilities resulting from almost a decade of recalls and lawsuits.
Its defective airbag inflators have been linked to at least 17 deaths around the world.
Takata Americas, its US arm, filed for Chapter 11 bankruptcy in Delaware on Sunday with liabilities of US$10 billion to US$50 billion, while the Japanese parent and subsidiaries filed for protection with the Tokyo District Court early yesterday.
Takata’s total liabilities stand at 1.7 trillion yen (S$21 billion) , Tokyo Shoko Research estimated.
Final liabilities would depend on the outcome of discussions with customers who have borne the bulk of the replacement costs, a lawyer for the company said.
The filings open the door to the financial rescue by Key Safety Systems (KSS) , a Michigan-based parts supplier owned by China’s Ningbo Joyson Electronic Corp.
