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Delphi sets bid procedures for $447 million steering and halfshaft businesses sale
By Caroline Salls
Pittsburgh, Dec. 11 - Delphi Corp. requested court approval of the bid procedures for the proposed $447 million sale of its global steering and halfshaft businesses, according to an 8-K filed with the Securities and Exchange Commission.
As previously reported, Platinum Equity, LLC company Steering Solutions Corp. is the stalking horse bidder.
The purchase price includes $190 million in assumed liabilities and estimated restructuring costs, as well as $257 million to be provided by General Motors Corp. as part of the sale.
GM would also be responsible for up to $65 million of Delphi's sale-related expenses.
Steering Solutions will make a $9.5 million deposit toward the purchase price. All competing bids must also include a $9.5 million deposit.
If Steering Solutions is not the high bidder or Delphi chooses to go with an alternative proposal, Delphi will pay it a $6 million break-up fee, plus up to $2 million for expense reimbursement.
If a break-up fee is not required, Delphi will pay all of Steering Solutions' sale-related expenses, up to the amount of the break-up fee.
Competing bids are due on Jan. 18 and must be for at least $1 million more than the proposed purchase price, plus the amount of the assumed liabilities, the amount of the break-up fee and the $2 million expense reimbursement.
Subsequent bids at auction must be for at least $1 million more than the previous bid.
A hearing on approval of the bid procedures is scheduled for Dec. 20. The auction will be held Jan. 28, and the sale hearing is set for Feb. 21.
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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