TOKYO – Scandal-hit Japanese airbag maker Takata has closed a deal to sell off a bulk of its operations and assets to American company Key Safety Systems for $1.58 billion, a spokesperson confirmed to EFE on Wednesday.
Takata and KSS, a global supplier of auto safety parts that is based in Michigan but owned by a Chinese company, announced the acquisition on Tuesday after a preliminary agreement end of June, when the Japanese company, a leading global supplier of automotive safety systems including seat belts, airbags and baby seats, had filed for bankruptcy protection in the United States after a massive recall of cars fitted with its faulty airbags.
Takata CEO Shigehisa Takada stressed the importance of the sale to continue “providing a steady supply of products to our valued customers, including replacement parts for recalls.”
He added that “the combined business will be well positioned for long-term success in the global automotive industry.”
The sale of Takata’s assets and operations – that will exclude its operations involving the faulty airbag inflators – are expected to be completed by the first quarter of 2018, the spokesperson said.
Meanwhile, the company has sought legal protection in a court in Tokyo as well as in the US for its subsidiary, TK Holdings, and has begun a restructuring process to continue to manufacture new air bags to replace the defective ones in millions of cars worldwide.
Takata’s liabilities total 380 billion yen ($3.41 billion) although its actual debt would be three times that amount after the cost of recalling over 42 million vehicles worldwide is added.
The fault in the airbags – which were found to explode when deployed, hitting passengers with metal shrapnels – have been linked to at least 15 deaths and have affected vehicles of 19 manufacturers worldwide.
Founded as a textile company in 1933, Takata, began manufacturing airbags in 1987 and went on to become one of the world’s leading industry leaders.
The company has 56 plants in 20 countries and approximately 46,000 employees.
KSS is owned by China’s Ningbo Joyson Electronic Corporation and has a global network of 13,000 employees.