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Wed July 29, 2009
Delphi heads to court to ask for bid's approval
NEW YORK – Delphi heads to bankruptcy court today seeking a judge's approval of a deal that could hand control of the auto supplier to its lenders and end its four-year stay in Chapter 11.
But standing in the way are more than 2,000 objections - many filed by Delphi workers and retirees worried about the future of their pensions. That could mean a lengthy day in court for all sides, including U.S. Judge Robert Drain who is overseeing the case.
Late Monday, Troy, Mich.-based Delphi said 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, 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.
Objections to the agreement had to be filed by the end of business yesterday. Delphi said Monday it was attempting to resolve as many of the objections as possible before today's hearing.