As Takata airbag inflator recalls continue, lawyers and accountants are inching the parent company's US unit towards emerging from bankruptcy so it can be broken up and sold.
According to the New York Times, which has been delving into court records, TK Holdings has reached an agreement with its creditors, lawyers for affected motorists and automakers that eases its way to end its Chapter 11 bankruptcy and sell its viable operations.
Go deeper with GlobalData
The paper said TK Holdings was after a judge's approval for its plan to exit bankruptcy despite the arguments of a committee representing injured drivers and a separate group acting for unsecured creditors.
However, the two committees, automakers and Key Safety Systems, which is acquiring Takata's viable business operations, reached a deal that resolves the biggest objections to the plan, the paper said, citing court documents filed on Saturday.
Under the agreement, a trust will be established to pay compensation for those injured or killed by the airbags and automakers will give up some of their claims against Takata.
The NY Times said 13 automakers that joined the agreement include General Motors, Ford, Toyota, and Honda and Volkswagen US units.
US Tariffs are shifting - will you react or anticipate?
Don’t let policy changes catch you off guard. Stay proactive with real-time data and expert analysis.
By GlobalDataThe report said an amended plan of reorganisation that incorporates the settlements will soon be filed with the bankruptcy court.
If approved, an injunction would prevent injured drivers from suing automakers which joined the agreement.
The US$1.6bn which Key Safety Systems will pay for Takata's viable operations would fund restitution claims by automakers and help pay personal injury and wrongful death claims as part of a plea deal with the United States Department of Justice, the New York Times report said.
