Key Safety Systems among bidders for Takata airbags business
Key Safety Systems Inc. (KSS), the world’s fourth-largest airbag maker, is among five bidders offering a financial lifeline to help Takata bear the costs of a massive global recall of its exploding air bags, people with knowledge of the process have told Reuters news cable agency.
All five bids require Takata to file for bankruptcy protection, they say.
KSS declined to confirm whether it was among the bidders, although the company in June said it was discussing a potential investment with Lazard, the investment bank Takata has hired to lead its financial restructuring.
Takata operates nine plants and one Technical Center in three different Mexican states, however just three facilities located in Coahuila produce airbags. KSS owns five plants in Mexico, four located in Valle Hermoso, Tamaulipas and one more in Ciudad Juarez, Chihuahua.
The Michigan-based KSS, whose origins go back 100 years as a supplier of steering wheels for Ford’s Model T, is planning to expand its Japanese customer base, which includes small-volume customers such as Isuzu Motors and Suzuki Motor Corp.
Buying Takata would create the world’s No. 2 airbag supplier by sales, behind Sweden’s Autoliv Inc., which is also said to be bidding for the Tokyo-based company. A purchase would also likely give Key Safety more access to Japanese companies, adding to its customer base that’s more reliant on U.S., German, Korean and Chinese brands.
Takata is at the center of the biggest safety recall in the automotive industry, with more than 100 million devices due to be replaced over their risk of rupturing and spraying shrapnel at vehicle occupants.
The number of fatalities tied to Takata’s inflators reached at least 16 worldwide following the death last month of a Honda City driver in Malaysia.