The Takata Corporation said that it’s looking to avoid bankruptcy because a restructuring could disrupt their ability to supply parts to automakers.
“We hope to have out-of-court settlement and our position hasn’t change since the beginning,” stated CFO Yoichiro Nomura. “There’s no other option to ensure the stable supply of the products. Court-led bankruptcy will make it difficult for the business to continue.”
According to Autonews, since Bloomberg reported last month that some fort of bankruptcy proceedings were being considered by Takata, their shares have fallen 14%. The Japanese manufacturer has since hired a financial adviser as well as a law firm in order to help them weigh options, including bankruptcy or a sale.
Overall, Takata’s market value has went down by a massive 72% in the past 12 months, reaching $271 million. The reason for that is of course the fact that their airbags use a propellant that can become unstable after long-term exposure to heat and humidity, causing the inflators to rupture and potentially hurt the occupants.
Still, a potential bankruptcy filing by Takata’s US unit could help the Japanese company find a buyer and continue supplying parts while seeking an out-of-court reorganization solution, as reported by Nikkei.
Also, after selling an interiors business as well as stakes in Japanese automakers (Honda, Toyota, Nissan, Fuji, Mitsubishi, Suzuki), Takata raised its full-year profit forecast – with a reported net income of 20 billion yen ($194 million) in the year ending March, compared to a 13.1 billion yen loss in the previous 12-month period.
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