Delphi's DIP accommodation, amended GM arrangement motions adjourned to Dec. 1

By Rebecca Melvin

New York, Nov. 24 - Delphi Corp.'s request to modify its existing $4.35 billion debtor-in-possession lending agreement - which is subject to objections - and its agreed General Motors Corp. arrangement were adjourned Monday for a week until Dec. 1 by the U.S. Bankruptcy Court for the Southern District of New York.

The adjournment was requested by GM over the weekend and will allow further discussions among Delphi and its objecting lenders.

GM requested that Delphi continue to review with DIP lenders the terms and conditions of the proposed accommodation, a Delphi lawyer told the court.

The company seeks court approval to continue using proceeds from the DIP loans through June 30 without penalties, though the loan package currently expires Dec. 31.

In a Nov. 7 court filing, Delphi said it expects to have consent for that change from a sufficient number of its lenders before a Nov. 24 hearing.

But in court papers, tranche A lender Calyon New York Branch said the accommodation agreement is a disguised extension of the maturity date or a forebearance agreement and a gross violation of the DIP agreement.

While certain provisions of the proposed accommodation agreement are financially attractive, the Calyon filing conceded, approving such an accommodation would significantly modify and impair the rights of lenders who relied on the DIP credit agreement and the DIP approved Jan. 5, 2007.

Tranche C lender Greywolf Capital Management LP also objected to the accommodation.

Tranche A of the DIP is worth $1.1 billion, tranche B is $500 million, and tranche C totals $2.75 billion.

The GM arrangement second motion isn't contested.

As previously reported, Delphi revised downward a week ago its projected revenue and EBITDAR information. Projected 2008 revenue is now expected to be $21.253 billion, down from a most recent estimation of $21.642 billion and from a previous projection of $22.203 billion, and first-half 2009 revenue is now expected to be $9.104 billion, down from a most recent estimation of $9.789 billion and from a previous estimation of $9.625 billion.

Projected EBITDAR for 2008 is now expected to be $592 million, compared to a most recent estimation of $745 million and a previous estimation of $526 million, and the first-half 2009 projected EBITDAR is expected to be $391 million, compared to a most recent estimation of $699 million and a previous estimation of $904 million.

Delphi is a Troy, Mich., automotive electronics manufacturer.

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