The Japanese auto supplier may be saved from its deep financial crisis by an US investment fund, but other buyers are also on the line.
Takata reported a net loss of only 13.1 billion yen (120.5 million dollars) for the financial year ended in March, but the worst for the Japanese supplier is yet to come soon, as it faces billions of dollars in costs over the recent recall airbags expansion. Therefore, Takata has hired investment bank Lazard Ltd to conduct a restructuring program, that is likely to include trimming some of its global airbag operations. But the company may be rescued by the US investment fund Kohlberg Kravis Roberts, which intends to take around 60 percent stake in Takata, according to a person familiar with the matter. KKR is not the only fund interested in such a move, the source added.
The auto supplier has to work very hard to avoid bankruptcy, considering the latest development of the inflators crisis. Earlier this month, the US Transportation Department and Takata confirmed that 17 automakers will recall another 35 million to 40 million US airbags by 2019. The faulty and explosive inflators have been linked so far to at least 13 deaths and over 100 injuries.
Reuters reported that if Takata was found to be solely responsible for the problem, it could face a crushing bill of more than 9 billion dollars in recall costs, based on a rough calculation that each replacement kit costs around 100 dollars.