Takata Corp., facing billions of dollars in liabilities related to its defective air-bag systems, sold an interiors unit to Vinnie Johnson, the former pro-basketball star who runs a handful of auto-parts companies under his Piston Group.
Takata (IW 1000/616) sold its Irvin Automotive Inc. unit to closely held Piston Group, the Michigan company said Wednesday in a statement. Terms weren’t disclosed, but the Nikkei reported Tuesday that the price was to be about 17 billion yen ($170 million). Irvin, which makes interior trim pieces, such as auto-seat covers, is based in Pontiac, Mich., with $500 million in annual sales to customers including Nissan Motor Co. and Delta Air Lines Inc.
Takata is at the heart of the worst safety crisis in auto-industry history, as inflators made by the company have been found to explode too forcefully, killing as many as 16 people. The Tokyo-based supplier is seeking a buyer that can help it produce some of the more than 100 million replacement inflators that may be needed. The Irvin business was separate from the seat-belt and air-bag units, so it was easy to split off and sell to Johnson, who said he is aiming to expand beyond North American operations.
“A lot of times, the customers are saying you need to be global,” Johnson said in a telephone interview. “If you don’t, you lose opportunities or you won’t survive, and that’s the game. Will we get there right away? No, but this gives us the opportunity to get there.”
The acquisition makes the Piston Group, with a projected $1.8 billion in 2016 revenues, one of the five largest closely held auto suppliers in southeastern Michigan, according to the statement, which cited Crain’s Detroit Business. Johnson, who spent most of his NBA career with the Detroit Pistons, owns all of the group companies, except for Detroit Thermal Systems, which is 49% owned by Valeo SA, a spokesman said in an e-mail.
Irvin, like the other group companies, will operate independently, with President Joseph Finn continuing to run the unit. As it becomes certified as a minority-owned business, or MBE, Irvin should be able to win new contracts and grow, Johnson said.
“One thing to keep in mind: Yeah, we’re MBE, but we’re a great supplier,” he said. “The reason why we’ve seen the growth over the years is because we’re competitive with good quality.”
By Jamie Butters