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Brake Supplier Akebono Seeks Turnaround Aid
Japanese brake system supplier Akebono Brake Industry Co. has filed for an out-of-court turnaround and is seeking financial aid to avoid bankruptcy, The Nikkei reports.
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Japanese brake system supplier Akebono Brake Industry Co. has filed for an out-of-court turnaround and is seeking financial aid to avoid bankruptcy, The Nikkei reports.
The plan targets only claims held by banks. Unlike a conventional court-led turnaround, the scheme—a relatively new option in Japan—won’t affect receivables from Akebono’s own suppliers.
The Nikkei says Akebono has asked its largest shareholder and biggest customer, Toyota Motor Corp., for a cash infusion. The supplier also is expected to ask its lenders to postpone loan payments due on 103 billion yen ($990 million) in debt, according to the newspaper.
Akebono is scrambling to complete the recovery plan by June. The company’s fortunes have been dragged down by its North American operations, which failed to win new business from local carmakers.
In an earnings report for its fiscal first half ended Sept. 30, Akebono warned last autumn that there were material doubts about its ability to avoid financial collapse. The company’s sales in April-September fell 7% to 126 billion yen ($1.2 billion), and operating profit plummeted 43% to 2.4 billion yen ($22 million)
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