Takata Shares Plunge on Report Company Is Considering U.S. Bankruptcy

Takata Airbags Lead Toyota, Nissan To Recall 3 Million Cars
The Takata Corp. logo is displayed outside the company's headquarters in Tokyo, Japan, on Thursday, April 11, 2013. Takata Corp. faces its biggest recall crisis in almost two decades after defective airbag inflators led Toyota Motor Corp., Honda Motor Co. and Nissan Motor Co. to call back more than 3 million vehicles. Photographer: Koichi Kamoshida/Bloomberg via Getty Images
Photograph by Koichi Kamoshida/Bloomberg via Getty Images

Shares of Takata fell sharply on Tuesday after The Wall Street Journal reported late last week that the troubled Japanese air bag maker is weighing a U.S. bankruptcy filing as one option for clearing a path for an outside investor.

Takata issued a statement on Tuesday saying the reported plan was not something it had announced. Markets were closed in Japan on Monday for a public holiday.

Citing people familiar with the matter, the Wall Street Journal said on Friday that Takata’s U.S. arm would seek protection from creditors in a federal bankruptcy court under preliminary plans being discussed.


Takata (TKTDY), which has retained investment bank Lazard as an advisor, has been working to choose a sponsor for its turnaround as it faces huge costs related to the global recall of millions of potentially faulty air bag inflators.

Reuters reported last month that all five bidders seeking to bail out Takata presented restructuring plans that require the company to file for bankruptcy protection.

Takata shares were trading down 6% in the morning session on Tuesday after initially falling as much as 10%.

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