TOKYO -- Shares in embattled supplier Takata Corp. surged for a second day in a row on Thursday, after the airbag maker this week said it was against pursuing a court-ordered turnaround.
The stock has gained 40 percent over two days, regaining most of the ground lost in the previous four sessions -- a sell-off triggered by reports that bidders for Takata were pushing for a court-mediated turnaround for its domestic business.
Such a process, however, could wipe out value for shareholders.
Takata is in the process of selecting a financial backer as it faces billions of dollars in costs to replace as many as around 100 million potentially defective airbag inflators that have been linked to at least 16 deaths globally.
Potential bidders for Takata have long favored a court-led turnaround of its Japanese operations, which would cap their exposure to Takata's existing liabilities, estimated by some analysts at as high as $10 billion for recall costs alone.
But the company in a strongly worded statement on its website dated Tuesday said: "Misleading media reports of a court-led turnaround are regrettable, as we are not assuming that such a course will be decided."
"A court-appointed restructuring may disrupt our supply chain and affect our ability to pay suppliers, and may pose risks to our stakeholders," it added.
Takata's shares surged 19 percent on Thursday, giving the company a market value of $450 million. They ended up by their daily limit on both days after not trading due to a glut of buy orders. The Tokyo Stock Exchange sets closing prices when stocks are not traded that reflect the balance of buy and sell orders.