TOKYO (BLOOMBERG) - Takata Corp shares tumbled as much as 69 per cent to a record low as the Tokyo Stock Exchange removed daily limits on the stock's price declines following the company's bankruptcy protection filings in Japan and the US.
The stock traded at 35 yen as of 11:21am in Tokyo trading. Shares of the air-bag maker have slumped 91 per cent since June 16, when they were suspended after Bloomberg and other media reported the company was preparing to seek protection from creditors.
Takata filed for creditor protection in the US on June 25. It received US court approval on Tuesday of so-called first-day requests, which included interim permission to pay vendors it deemed critical, as well as employee salaries. Key Safety Systems Inc agreed to buy the company for US$1.6 billion (S$2.22 billion).
Takata's bankruptcy, the biggest by a Japanese manufacturer in the postwar period, signals the end for an 84-year-old company that began as a textile maker and supplied parachutes to the Imperial Japanese Army during World War II. It conducted an initial public offering in 2006, and the shares were worth 5,160 yen each at their peak. The Tokyo exchange will delist the company on July 27.
The company buckled under the weight of more than US$10 billion in liabilities tied to the recalls of faulty air bags that can explode with too much force, spraying metal shards at vehicle occupants. The devices have been linked to at least 17 deaths worldwide. Claims against Takata listed in its filings include individuals who have brought class-action lawsuits and automakers seeking reimbursement for recall costs.