Shareholders are not swayed by Takata’s white knight
But Key Safety Systems has a lot to gain by buying the airbag maker felled by an unprecedented global recall, writes Nisha Gopalan
Hong Kong — A court-mandated bankruptcy is in Takata’s stars, if shareholders in the Japanese airbag maker are to be believed. Stock in the group, whose faulty products are linked to at least 17 deaths and the subject of recalls that may exceed 100-million units, plunged by the daily limit in Tokyo on Monday after an announcement at the weekend that Key Safety Systems, a US supplier controlled by China’s Ningbo Joyson Electronic Corporation, has been recommended as a preferred bidder. With sell orders overwhelming buys, no shares actually changed hands. Takata shares, year to date: down 49.1% Hang on, aren’t white knights generally good news? Well, yes and no. Although bankruptcy protection would help shield Joyson Electronic from billions of dollars of liabilities, it would also wipe out investors’ equity. Takata has indicated it wants to avoid that scenario, but shareholders clearly need more convincing. Purchasing Takata would be a good deal, though, for Joyson Electronic, one of...
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