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Key Safety Systems to buy Takata’s assets for $1.58bn

ABR Staff Writer Published 21 November 2017

American automotive safety system supplier Key Safety Systems (KSS) has signed an agreement with airbag manufacturer Takata to purchase the latter's assets and operations for ¥175bn ($1.58bn).

The Japanese company stated that it will file for Chapter 11 insolvency plan in the US in June and the initial sale agreement between Takata and KSS was first signed back then.

Takata stated that it is selling most of its assets and operations except for those related to Takata’s manufacturing and sale of phase-stabilized ammonium nitrate (PSAN) airbag inflators.

It stated that it will reorganize those assets and operations and will eventually wound them down, after the sale is completed.

Takata chairman and CEO Shigehisa Takada said: “We are very pleased to have reached this agreement with KSS, which is an important step toward the consummation of our sale and achieving the objectives we identified at the outset of this process.

“Our top priorities continue to be providing a steady supply of products to our valued customers, including replacement parts for recalls, and a stable home for our exceptional employees.”

Takata will need to submit a business rehabilitation blueprint to the Tokyo District Court. After receiving creditors’ approval, the business and the asset transfer is expected to be closed in the first quarter of next year, Nikkei Asian Review reported.

KSS president Yuxin Tang said: “The acquisition of Takata fits perfectly with KSS’s century-long commitment to the automotive business. The combined company will enhance our ability to serve customers globally and provide superior products and innovation in the rapidly evolving auto safety industry.

“We enter this transaction in a spirit of partnership and anticipate executives and employees from both KSS and Takata together will play important roles -- from initial integration through strategic execution.”

For many years now Takata has been undergoing several lawsuits regarding its poor and malfunctioning airbag systems that have caused at least 11 deaths in the US and has resulted in millions of vehicles being recalled by several automakers around the world.

Image: Takata to sell all of its assets except for the ammonium nitrate airbag inflator assets. Photo: Courtesy of harald wittmaack/FreeImages.com.