US: Judge to rule on GM Delphi payment
The US autos task force overseeing the restructuring of General Motors Corp has asked a federal bankruptcy judge to block the automaker from providing an additional $150m in funding to bankrupt parts supplier Delphi.
The task force asked US bankruptcy judge Robert Drain of the Southern District of New York to give the federal government until 30 April to assess GM's relationship with its troubled former parts unit.
Delphi, which GM spun off in 1999, has been operating under Chapter 11 bankruptcy protection since 2005.
In March, GM said it had agreed to advance Delphi $450m, up from $300m, contingent on completing its purchase of Delphi's steering unit.
Just over a week ago, Drain delayed a decision on whether to approve the sale of the steering unit to GM after the treasury objected. It has the authority to block transactions of over $100m by GM under the terms of the government's emergency loans.
In its filing on Wednesday, the autos task force said it had informed GM on 23 March that it objected to the $150m increase in funding for Delphi.
"Treasury's right to prohibit GM for funding Delphi $150 million is unequivocal," the task force said in its filing.
A hearing before Drain is taking place on Thursday (2 April).