Delphi gets court OK on bid procedures for $106 million sale of interiors and closures business

By Reshmi Basu

New York, Oct. 25 - Delphi Corp. received approval of the bidding procedures on the proposed sale of its global interiors and closures business to a wholly owned subsidiary of the Renco Group, Inc. from the U.S. Bankruptcy Court for the Southern District of New York.

As previously reported, a subsidiary of the Renco Group 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 $500,000 more than the previous bid.

Bids must be received by Nov. 26. The auction is scheduled for Dec. 6, and the sale hearing is set for Dec. 20.

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.

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

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

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

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.