Takata shares dive on ‘mulling bankruptcy’ report
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