Delphi sets bid procedures for $44.2 million sale of wheel bearings business

By Caroline Salls

Pittsburgh, Jan. 17 - Delphi Corp. has agreed to sell its wheel bearings business to Resilience Capital Partners subsidiary ND Acquisition for $44.2 million, subject to an auction for higher offers, according to a company news release.

According to the release, the proposed wheel bearings business sale will include a Sandusky, Ohio, production and engineering facility, machinery and equipment, inventory, intellectual property and the assignment and assumption of customer and supplier contracts, as well of the transition of salaried and hourly workforce.

A hearing on approval of the bid procedures is scheduled for Jan. 25. The auction is set for Feb. 13, and the sale hearing will be held Feb. 21.

According to court documents, ND Acquisition paid a $750,000 deposit.

If ND Acquisition is not the high bidder, Delphi will pay it a $1.5 million break-up fee and pay its out-of-pocket expenses related to the sale.

Delphi said it will not pay the break-up fee if the buyer fails to secure financing to purchase the business.

Competing bids are due Feb. 11 and must include a $750,000 deposit.

Initial overbids must be for at least $500,000 more than the stalking horse bid, plus the amount of the break-up fee and expense reimbursement.

Subsequent bids at auction must be for at least $250,000 more than the previous bid.

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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