Delphi has said it has reached a deal to sell most of its global operations to private equity firm Platinum Equity, allowing it to emerge from Chapter 11 bankruptcy protection.
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Under the new reorganization plan for the former parts affiliate of General Motors Corp , Parnassus Holdings II LLC, a unit of Platinum Equity, would acquire and operate Delphi’s US and non-US businesses with emergence capital and capital commitments totalling US$3.6bn.
“After an extended period of complex and challenging discussions with a wide range of stakeholders, we are confident that these modifications to our confirmed Plan of Reorganization will provide a resolution that will allow Delphi to emerge from Chapter 11,” said Rodney O’Neal, Delphi CEO and president. “
“We are grateful for the patience of our customers, who have placed their trust in Delphi’s ability to provide world-class products and uninterrupted supply, and the support of our suppliers who have contributed broadly to our efforts. We are also thankful for the dedicated Delphi employees who have remained focused on our customers and to the communities in which we operate for their unwavering support during the most challenging period in our history.”
According to O’Neal, Delphi’s emerging businesses will continue to develop technology and products and produce them for the benefit of its customers under the guidance of Platinum, a company with experience providing operational support to companies to help them create long term value.
O’Neal said that Delphi had worked diligently to obtain support from Platinum, GM and the Company’s lenders and other stakeholders to effect Delphi’s emergence from Chapter 11 through the plan modifications filed today with the Bankruptcy Court but has also committed to complete these transactions through a sale of the Company to GM Components and Parnassus if sufficient stakeholder support is not obtained to promptly achieve confirmation and substantial consummation of the modified plan of reorganization.
The final approval hearing on the emergence transactions has been scheduled by the Bankruptcy Court for July 23, 2009. A final hearing on the incremental $250 million subordinated DIP facility has been set for June 16, 2009. Delphi expects preliminary hearings previously scheduled for June 2, 2009 to be rescheduled by the Bankruptcy Court to later this week or next week.
