Creditors OK Takata Rehabilitation Plan

May 24, 2018

Tokyo, May 23 (Jiji Press)--Creditors of Takata Corp. approved on Wednesday a rehabilitation plan for the Japanese auto parts supplier, which went under due to massive recalls of vehicles equipped with its fatally defective air bag system.

The plan chiefly calls on Takata to fully repay debts up to 500,000 yen to creditors other than automakers and one pct of amounts over 500,000 yen.

In June last year, Takata filed for bankruptcy protection in Japan and the United States due to swelling recall costs.

The company sold its operations to Chinese-affiliated U.S. auto parts maker Key Safety Systems Inc. for some 170 billion yen in April.

After making payment from the proceeds to the U.S. Justice Department for setting up a fund to compensate for victims of rapturing of Takata-made air bag inflators, Takata plans to use the remainder of the money for debt repayment stipulated in the rehabilitation plan.

The failed air bag maker's liabilities total about one trillion yen. Jiji Press