TOKYO, Sept 29 All five bidders seeking to bail
out Japan's beleaguered Takata Corp have presented
restructuring plans that require the air bag maker to file for
bankruptcy protection, people with knowledge of the process told
But some Japanese creditors have opposed such a filing as it
would see them shoulder significant losses, the people said,
declining to be identified as the proposals have not been made
Takata faces huge costs related to the global recall of
millions of potentially faulty air bag inflators, and is seeking
an outside investor to increase its capital. The company
received proposals from five bidders last week.
The bidders include Japanese inflator maker Daicel Corp
in partnership with U.S. buyout firm Bain Capital; U.S.
private equity firm KKR & Co LP ; U.S. air bag maker Key
Safety Systems, which is likely to team up with U.S. private
equity firm Carlyle Group LP ; Swedish auto safety group
Autoliv Inc ; and U.S. autoparts maker Flex-N-Gate Corp,
the people said.
Takata's creditors include Honda Motor Co Ltd and
Toyota Motor Corp in Japan, as well as foreign
automakers such as General Motors Co, Volkswagen AG
and Fiat Chrysler Automobiles NV.
Filing for bankruptcy protection is Takata's only option to
retain the bidders' interest because a filing will reveal the
extent of its liabilities, one of the people said.
Representatives from Takata, Daicel, KKR, Carlyle and
Autoliv declined to comment. Representatives at Bain Capital and
Flex-N-Gate could not be immediately reached for comment.
Takata faces about 1 trillion yen ($10 billion) in recall
costs, according to market estimates. There is also the prospect
of legal liabilities related to the inflators, which can explode
with too much force, and which have been linked to at least 15
deaths, mainly in the United States.
"It is understandable that any potential sponsors want to
reset Takata's 1 trillion yen in debt through bankruptcy but it
is hard to accept that," said a senior official at a Japanese
Takata's steering committee this week has been briefing
officials from Japanese and foreign automakers on the five
bidders' proposals, the people said.
A senior official from a different Japanese automaker said
both Japanese and foreign automakers would oppose Takata filing
for bankruptcy protection.
Takata, which has retained investment bank Lazard Ltd
as advisor, had 109 billion yen in capital as at the end
of June. Its debt would exceed capital if it had to cover most
or all of the recall costs. So far, its automaker clients have
covered the costs.
($1 = 101.5000 yen)
(Reporting by Maki Shiraki and Junko Fujita; Editing by