Shares in Takata Corp jumped 16% yesterday after sources said the beleaguered airbag maker will plead guilty to criminal wrongdoing as part of a $1bn settlement with US authorities.
The settlement includes a $25mn criminal fine, $125mn in victim compensation and $850mn to compensate automakers who have suffered losses from massive recalls, the sources said.
“Takata has taken a step forward regarding the airbag issue with the US Justice Department and this is being taken positively by the market,” said Mitsushige Akino, executive officer at Ichiyoshi Asset Management but he added that the firm’s woes were far from over.
Takata still faces a potential $10bn in liabilities after recalling around 100mn defective airbags linked to at least 16 deaths worldwide, including 11 in the United States.
Shares in Takata surged 16% or by 150 yen, its daily limit, to give it a market value of about $770mn.
It is seeking a financial backer to help it restructure.
But while some bidders want Takata to go through bankruptcy to wipe out most of its debt, creditors such as Honda Motor Co are likely to resist any bailout that includes bankruptcy as they would have to shoulder significant losses, sources have said.
Sources have also said that bidders for Takata include rival inflator maker Daicel Corp in partnership with US buyout firm Bain Capital, US airbag maker Key Safety Systems, which is expected to team up with US private equity firm Carlyle Group LP, Swedish auto safety group Autoliv Inc; and US autoparts maker Flex-N-Gate Corp.
LEAVE A COMMENT Your email address will not be published. Required fields are marked*
Al-Kaabi meets Korea’s minister of trade, industry and energy
Ooredoo represents Qatar’s ICT, tech industries at Qatar-Korea Business Forum
Interest in data privacy growing rapidly, say PwC Qatar, QFC
Boeing strips CEO of chairman job as 737 MAX crisis drags on
US-China deal: Traders want to see agricultural component
Donald Trump has real reasons to fixate over the stock market
After hope-fuelled rally, coming days are key for Europe stock markets
India market’s favourite bank surrounded by lending crisis
Is world economy sliding into 1st recession since 2009?