Takata shares dive on ‘mulling bank­ruptcy’ re­port

The Sun (Malaysia) - - SUNBIZ -

TOKYO: Takata shares nose­dived yes­ter­day fol­low­ing re­ports that the Ja­panese airbag maker, hit by the auto in­dus­try’s biggestever safety re­call, was con­sid­er­ing fil­ing for bank­ruptcy in the United States.

With Tokyo in­vestors re­turn­ing from a three-day week­end, the stock fell nearly 11% at the start be­fore end­ing the day at ¥347 (RM13.94), down 7.46%.

The drop was a re­sponse to a Wall Street Jour­nal re­port that the com­pany was weigh­ing a US bank­ruptcy fil­ing “as one op­tion” – it is fac­ing huge com­pen­sa­tion costs over a de­fect linked to 16 deaths and scores of in­juries glob­ally.

The firm may seek court pro­tec­tion only for its US divi­sion, Bloomberg News re­ported, cit­ing sources fa­mil­iar with the mat­ter.

Some 100 mil­lion Takata airbags have been re­called due to the de­fect, which an send metal and plas­tic shrap­nel from the in­fla­tor can­is­ter hurtling to­wards driv­ers and pas­sen­gers when an airbag is de­ployed.

Some au­tomak­ers in Ja­pan are wor­ried a bank­ruptcy fil­ing could threaten Takata’s ac­cess to op­er­at­ing funds and dis­rupt their airbag sup­plies, the Jour­nal re­port said, cit­ing peo­ple fa­mil­iar with the mat­ter. – AFP

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