8 October 2009

… Delphi emerges from Chapter 11

My, how times flies when you are in bankruptcy. It has taken four years, but U.S. auto parts maker Delphi emerged from Chapter 11 on Tuesday as a private company.

Delphi, which filed for bankruptcy on 8 October 2005, cut thousands of workers, divested several businesses, and agreed to sell its steering systems operations and four plants back to GM for the reorganization.

The auto parts maker’s exit from bankruptcy came through a sale of most of its assets to Delphi Holdings LLP, led by senior creditors Elliott Management Corp and Silver Point Capital LP.

Rodney O’Neal remains chief executive of Delphi and the leadership remains in place, Delphi officials said.

The group acquiring Delphi agreed to forgive nearly $3.5 billion of bankruptcy loans it bought from previous bankruptcy lenders and will invest $900 million in capital in the company.

GM will acquire other parts of the company, and the rest will be liquidated under the plan approved by a U.S. Bankruptcy Court judge in July. The transaction has pending regulatory approvals in Russia and South Africa.