Delphi seeks approval of bid procedures for $106 million sale of interiors and closures business

By Caroline Salls

Pittsburgh, Oct. 16 - Delphi Corp. requested court approval of the proposed sale of its global interiors and closures business and has entered into a master sale and purchase agreement with a wholly owned subsidiary of The Renco Group, Inc. for the sale of its global interiors and closures business, according to a Delphi news release.

According to court documents, a subsidiary of The Renco Group, Inc. submitted a $106 million offer for the business, including an $80 million preliminary purchase price and $26 million in post-closing payments.

The Renco subsidiary will pay a $2 million deposit.

If the Renco subsidiary is not the high bidder, Delphi will pay it a break-up fee of $2.4 million or 3% of the alternative proposal purchase price and up to $250,000 in expense reimbursement.

Competing bids must be for more than the purchase price, plus the amount of the break-up fee plus $1 million. All subsequent bids must be for at least $1 million more than the previous bid.

Delphi said the agreement has been approved by its board of directors.

A hearing for approval of the bidding procedures is scheduled for Oct. 25, and the final sale hearing is expected to be held on Jan. 8.

According to the release, the purchase agreement includes the interiors and closures business line's book of business, manufacturing operations, intellectual property, personnel, supplier contracts and share of joint ventures.

Delphi said its interiors and closures business operates manufacturing facilities in Gadsden, Ala.; Cottondale, Ala.; North Kansas City, Mo.; Orion, Mich.; Adrian, Mich.; Woerth, Germany; and Matamoros, Mexico.

The interiors business produces instrument panels and consoles and cockpits, and the closures business produces vehicle latches and door modules, according to the motion.

The business also operates under joint ventures in Shanghai and Daegu, Korea.

Delphi, a Troy, Mich.-based automotive electronics manufacturer, filed for bankruptcy on Oct. 8, 2005 in the U.S. Bankruptcy Court for the Southern District of New York. Its Chapter 11 case number is 05-44481.

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