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Key Safety Systems Inc. CEO Jason Luo has the swagger of a riverboat gambler who has just pushed all his chips into the center of the table.
And that's understandable for a Detroit executive who just leapfrogged his competitors.
Luo, a Chinese-born engineer- turned- manager who settled in the United States after college, announced plans to buy most of the assets of the newly bankrupt Japanese airbag supplier Takata Corp. for $1.6 billion.
The deal will more than triple Key Safety's annual sales to $7.5 billion, enabling the suburban Detroit company to become the industry's No. 2 airbag maker, behind Sweden's Autoliv.
"We started thinking about this three or four years ago," Luo revealed in an interview just after last week's acquisition was announced. "I've known Takata for many years. I know the management. I know the people."
Overnight, the deal will catapult Key Safety from an airbag market share of 8 percent to approximately 25 percent, thanks to the assets and customer base of the much-bigger Takata.
Takata's thriving seat belt business -- which accounted for 33 percent of the company's revenue last year -- will give Key Safety a big share of that product segment.
The Takata deal also creates new business possibilities for the electronics company that acquired Key Safety last year, Ningbo Joyson Electronic Corp.
And despite the maelstrom of fines, lawsuits and multibillion-dollar recall costs that have bankrupted Takata, Key Safety will not be financially exposed to those liabilities.
But Luo's success is not assured. As he works to complete the deal in 2018, he must:
-- Prevent further brain drain of key Takata staffers fleeing the company.
-- Ensure that Key Safety executives can manage their fast-growing empire.
-- Persuade skeptical Japanese automakers to buy his airbags.
-- Fend off hungry rivals such as Autoliv, Toyota-affiliated Toyoda Gosei and powerful TRW, now owned by Germany's ZF.
Luo seems unfazed by the challenges, in part because he has been studying the move for years -- well before Key Safety was purchased last year by Ningbo Joyson.
Luo has taken several steps to reassure Takata...