STERLING HEIGHTS, Mich.—Key Safety Systems Inc., through its Chinese parent company and two outside investors, completed the acquisition of scandal-plagued Takata Corp. on April 11.
The $1.6 billion deal, first disclosed in November 2017, will result in a combined Takata and Key Safety company renamed Joyson Safety Systems. Key Safety's parent company, Ningbo Joyson Electronics Corp., along with private equity firm PAG and Chinese state-owned Future Industry Investment Fund provided financing for the deal using a combination of equity and debt.
The combined company plans to move its global headquarters from Sterling Heights to Auburn Hills, it said in a news release.
Takata said April 12 that its president, Shigehisa Takada, resigned now that the acquisition is complete. Takada said in a statement that as of April 11 he was succeeded by Yoichiro Nomura, its chief financial officer.
Key Safety won a stalking horse bid to acquire the embattled Japanese supplier out of bankruptcy, which it filed last year.
Takata's malfunctioning airbag inflators, which have sent shards of metal into drivers and passengers and are linked to at least 17 deaths globally, have plagued it for more than eight years.
With pressure mounting, the 84-year-old Takata filed for bankruptcy protection in Japan and its U.S. subsidiary, Auburn Hills-based TK Holdings Inc., filed for Chapter 11 protection in Delaware on June 25 in a prepackaged agreement to sell to Key Safety, which beat out nearly a half dozen competitors.
Under the deal, Key Safety's management vows to maintain Takata's 40,000-person employment base, with the exception of its problematic ammonium nitrate airbag inflator business, which is expected to end operation after the sale.
The deal was further complicated after Key Safety's CEO Jason Luo resigned in August to take the CEO position for Ford China. Yuxin Tang, member of Key Safety's board, assumed the role of interim president.
The acquisition will make Key Safety one of the largest players in the safety market, with more than 50,000 employees in 23 countries and more than $7 billion in revenue.
Skadden, Arps, Slate, Meagher & Flom L.L.P. served as legal counsel, KPMG and Jefferies LLC acted as financial advisers to Key Safety.
Nagashima Ohno & Tsunematsu, Weil Gotshal & Manges L.L.P. and Freshfields Bruckhaus Deringer L.L.P. served as legal counsel to Takata. PricewaterhouseCoopers served as financial advisor and Lazard served as investment bank to Takata.