Delphi looks to JPMorgan, Citigroup to assemble $6.8 billion exit financing syndicate

By Caroline Salls

Pittsburgh, Nov. 7 - Delphi Corp. is seeking court approval of a "best efforts" engagement letter with potential exit facility arrangers JPMorgan Securities Inc., JPMorgan Chase Bank, NA and Citigroup Global Markets Inc., according to a Wednesday filing with the U.S. Bankruptcy Court for the Southern District of New York.

Under the engagement letter, JPMorgan and Citigroup have agreed to attempt to assemble a syndicate for $6.8 billion in exit financing.

Delphi said the potential exit facility would consist of a $1.6 billion senior secured first-lien asset-based revolving credit facility; a $3.7 billion senior secured first-lien term facility; and a $1.5 billion senior secured second-lien term facility, of which up to $750 million would be in the form of a note issued to General Motors Corp. in connection with plan of reorganization distributions.

As previously reported, the company was originally seeking up to $7.5 billion in funded debt and a $1.6 billion asset-based revolver, but Delphi said it reduced proposed debt levels to facilitate an emergence financing package that could be executed under existing market conditions.

A hearing is scheduled for Nov. 16.

Delphi, a Troy, Mich.-based automotive electronics manufacturer, filed for bankruptcy on Oct. 8, 2005. Its Chapter 11 case number is 05-44481.

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