BUSINESS: Delphi asking court for bid approval

Delphi

July 30, 2009

Anonymous The Lockport Union-Sun %26 Journal Thu Jul 30, 2009, 01:20 AM EDT

BY BREE FOWLER

The Associated Press

NEW YORK — A hearing on Delphi Corp.’s plan to hand control of the company to its lenders and eventually end its nearly four-year stay in Chapter 11 got under way Wednesday with arguments from attorneys representing the auto supplier and some of those objecting to the plan.

Hundreds of attorneys and Delphi stakeholders filled U.S. Judge Robert Drain’s Manhattan courtroom, along with two overflow rooms, promising a long day in court for everyone involved. Several high-ranking Delphi executives were also present but were not asked to testify.

Nearly 2,000 objections — including about 1,400 from Delphi workers and retirees worried about the future of their pensions — have been filed against the plan, though many had been resolved before the start of the hearing.

Much of the early part of the day was taken up with procedural activities, though Drain did overrule objections from the Michigan Workers’ Compensation Agency, Texas taxing authorities and Indiana’s Howard County.

In addition, attorneys announced the settlement of objections filed by handful of Delphi’s labor unions, including the United Auto Workers and the IUE-CWA.

Arguments on objections from current and formal Delphi employees were expected to take place following a midday recess. Once all the objections and arguments are heard, Drain is expected to decide whether to approve Delphi’s plan.

Late Monday, Troy, Mich.-based Delphi said that its lenders won out over a California private-equity firm in an auction for the company’s assets. The lenders, led by JPMorgan Chase Bank, agreed to forgive the combined about $3.45 billion in debt owed them by Delphi.

The deal is backed by General Motors Co., which has pumped billions of dollars into Delphi since it filed for Chapter 11 in October 2005 to ensure a stream of parts for its vehicles.

Delphi, which was Detroit-based GM’s parts division before being spun off in 1999, still produces about 10 percent of the parts used in GM’s global production and its components go into nearly all of GM’s North American production lines.

Last month, Delphi agreed to let an affiliate of Beverly Hills, Calif.-based Platinum Equity take control of most of the auto supplier’s businesses with the help of billions from GM.

Delphi’s lenders, which have financed the company’s operations during its years under court oversight, balked at the deal, calling it a “secretly negotiated transaction” that violated Delphi’s obligations to maximize the value of the lenders’ investment. In response, they submitted their own bid, which ultimately won out over the deal with Platinum.

The auto supplier said the agreement with its lenders is similar in structure to the one reached with Platinum in which GM would take back some of Delphi’s businesses, including its Saginaw, Mich.-based steering business, and facilities and help finance the deal.

Delphi said Monday that it has resolved objections filed by several state and federal agencies. If approved, the deal with lenders also will resolve 600 severance-related objections through the assumption and payment of those obligations, Delphi said.

More than 1,400 pension-related objections filed by Delphi employees, retirees and others still remain. Several of the company’s suppliers have also filed objections, but those disputes have been adjourned to a separate Aug. 17 hearing and aren’t expected to affect the outcome of Wednesday’s hearing.

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Delphi

Still no answers for Delphi retirees
Twenty-two thousand Delphi Corp. retirees found out 16 months ago their pensions were being turned over to a federal agency. In July 2009, the Pension Benefit Guaranty Corp. took control of those pensions, which meant possible cuts of anywhere from 30 percent to 70 percent in the retirement plans.
Hourly employees faced the same situation, except General Motors agreed to top off those pensions. Salaried retirees did not have their pensions topped off by anyone.
Now they want to know why. Letters, testimonies and speeches have asked the U.S. Treasury Department, the department’s Auto Task Force and the Obama Administration for information on that decision was made.

August 1, 2010 1 Photo
Delphi retirees group came together quickly
Salaried workers and retirees lost big chunks of their pensions in July 2009, and almost as quickly, the Delphi Salaried Retiree Association was formed.
The DSRA actually started forming when it was announced Delphi was eliminating health care and life insurance benefits for salaried retirees as of April 1, 2009. There are roughly 22,000 salaried Delphi retirees nationwide.

August 1, 2010
DELPHI: UAW supports salaried retirees' fight for pension equity The United Auto Workers are supporting Delphi salaried retirees who are fighting to save their pensions.
January 27, 2010
DELPHI: Salaried retirees gain key support in fight against pension cuts Delphi Corp. salaried retirees and employees have gained a vote of support from some members of the U.S. House of Representatives.
December 3, 2009
BUSINESS: Delphi emerges from bankruptcy
October 7, 2009
DELPHI: Approval of bankruptcy exit plan hailed by local political leaders Local political leaders hailed as good news Thursday’s announcement about the approval of Delphi Corp.’s bankruptcy exit plan.
July 31, 2009
BUSINESS: Delphi asking court for bid approval A hearing on Delphi Corp.’s plan to hand control of the company to its lenders and eventually end its nearly four-year stay in Chapter 11 got under way Wednesday in New York City with arguments from attorneys representing the auto supplier and some of those objecting to the plan.
July 30, 2009
DELPHI: Auto parts maker in court today on bankruptcy exit plan Delphi Corp. will be in court today asking for approval of a modified plan that could end a four-year adventure in Chapter 11 bankruptcy.
July 28, 2009
DELPHI: Creditors win in auction for company's assets Auto parts maker Delphi Corp. said Monday its creditors won out over a California private-equity firm in an auction for the company’s assets as it moves to emerge from bankruptcy protection.
July 27, 2009
DELPHI: GM buy-back progresses; retiree benefits gain support Support has come for both General Motors’ plan to buy back Delphi plants and for Delphi’s salaried retirees.
July 13, 2009
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