The Takata Corporation is looking to avoid bankruptcy because a restructuring could disrupt their ability to supply parts to automobile manufacturers. Earlier, most of the automakers recalled its cars due to faulty Takata airbags.
Yoichiro Nomura, Chief Financial Officer of Takata said, "We hope to have an out-of-court settlement and our position hasn't changed since the beginning. There's no other option to ensure the stable supply of the products. Court-led bankruptcy will make it difficult for the business to continue."
Last month, some reports surfaced on the internet revealing that Takata is considering some sort of bankruptcy proceedings. Also, the company's shares have fallen 14 percent after the airbag issue.
Since then, the Japanese manufacturer has hired a financial adviser as well as a law firm. This will help the company to weigh options, including bankruptcy or a sale.
In the past 12 months, Takata's market value has gone down by a massive 72 percent, reaching $271 million. The reason behind that is a chemical compound that can explode with excessive force after long exposure to hot or humid conditions.
By filing bankruptcy, Takata's US unit could help the Japanese company find a buyer. Thus, that can continue supplying parts while seeking out-of-court reorganisation solution.