Japan’s Takata Corp , at the center of the auto industry’s biggest-ever product recall, filed for bankruptcy protection in the United States and Japan, and said it had agreed to be largely acquired for $1.6 billion by the Chinese-owned U.S.-based Key Safety Systems.

In the biggest bankruptcy of a Japanese manufacturer, Takata faces tens of billions of dollars in costs and liabilities resulting from almost a decade of recalls and lawsuits. Its air bag inflators have been linked to at least 16 deaths and 180 injuries around the world because they can rupture and send metal fragments flying.

Takata’s bankruptcy filing is a milestone in a restructuring orchestrated and financed in part by major automakers who need to assure a supply of replacement inflators for tens of millions of their cars that are still subject to recalls.

The deal may also result in Key becoming a stronger competitor in the global market for air bag and safety technology and help ensure a broadly competitive air bag market for automakers.

TK Holdings, its U.S. operations, filed Chapter 11 bankruptcy in Delaware on Sunday with liabilities of $10 billion to $50 billion; the Japanese parent filed for protection with the Tokyo District Court early on Monday.

Scott Caudill, chief operating officer of TK Holdings, said in a court affidavit that the company “faces insurmountable claims” relating to the recalls and owes billions of dollars to automakers. He disclosed that Takata has recalled, or expects to recall, by 2019 about 125 million vehicles worldwide, including more than 60 million in the United States.

Takata’s total liabilities stand at 1.7 trillion yen ($15 billion), Tokyo Shoko Research Ltd estimated.

Final liabilities would depend on discussions with carmaker customers who have borne the bulk of the replacement costs, a lawyer for the company said.

The filings open the door to the financial rescue by Key Safety Systems (KSS), a Michigan-based parts supplier owned by China’s Ningbo Joyson Electronic Corp. Ningbo Joyson acquired KSS in 2016 in a $920 million deal.

In a deal that took 16 months to hammer out, KSS agreed to take over Takata’s viable operations, while the remaining operations will be reorganized to continue churning out millions of replacement inflators, the two firms said.

Jason Luo, CEO of KSS, said in a statement the “underlying strength” of Takata’s business had not diminished despite the recall, citing its skilled employees, geographic reach and other safety products such as seat belts.

Caudill said automakers would provide Takata up to $400 million over the course of the bankruptcy by accelerating payments and agreeing not to withhold what Takata owes them. In return, Takata agreed to provide the automakers access to their plants to ensure continued supply of parts.

Takata does not plan to hold an auction of its assets, often used to ensure assets fetch top dollar for creditors. Caudill said that would be a waste of time, given Takata was extensively shopped prior to the bankruptcy and that only one bidder had clear support from automakers.

Takata will ask the U.S. Bankruptcy Court in Delaware to appoint a representative for people who will be injured in the future from Takata inflators. The company said it plans to set aside sufficient money to cover those claims, which will be based on an expert’s estimate. An initial court hearing on the U.S. bankruptcy filing is set for Tuesday.

“We believe taking these actions in Japan and the U.S. is the best way to address the ongoing costs and liabilities of the air bag inflator issues with certainty and in an organized manner,” Takata CEO Shigehisa Takada said in a statement.

The remainder of Takata assets will be reorganized to produce replacement inflators, but it is not clear how long they will operate.

CEO Takada said he and top management would resign “when the timing of the restructuring is set.” His family – which still controls the 84-year-old company – likely would cease to be shareholders.

Takata in February pleaded in a U.S. federal court to a felony charge as part of a $1-billion settlement that included compensation funds for automakers and victims of its faulty air bag inflators. Three former senior Takata executives were charged in January with falsifying test results.

About two-thirds of 46.2 million recalled Takata inflators in the United States have not been fixed.

It also faces hundreds of lawsuits and claims in the United States, Mexico and Canada, including consumer protection lawsuits filed by three states and 100 personal injury and wrongful death claims.

Honda Motor Co, Takata’s biggest customer, said it had reached no final agreement with Takata on responsibilities for the recall. Honda said it would continue talks with the supplier but anticipated difficulties in recovering the bulk of its claims.

Unprecedented Recalls

Takata faces billions in lawsuits and recall-related costs to its clients, including Honda, BMW, Toyota Motor Corp and others, which have been paying recall costs to date.

The ammonium nitrate compound used in the air bags was found to become volatile with age and prolonged exposure to heat, causing the devices to explode. Takata continued to defend the compound even as competitors stopped using it, until reaching a 2015 agreement with regulators to phase out its use.

Costs so far have pushed the company into the red for three years, and it has been forced to sell subsidiaries.

Founded as a textiles company in 1933, Takata began producing air bags in 1987 and at its peak became the world’s No. 2 producer of the safety products. It also produces one-third of all seatbelts used in vehicles sold globally, along with other components.

The Tokyo Stock Exchange said its shares would be delisted on July 27. The stock has collapsed 95 percent since January 2014. ($1 = 111.30 yen)

(Additional reporting by Tom Hals in Wilmington, Delaware and Maki Shiraki in Tokyo.)