Delphi granted six-month exclusivity extension

By Caroline Salls

Pittsburgh, Jan. 6 - Delphi Corp. obtained a six-month extension to its exclusive periods to file a plan of reorganization and solicit votes on the plan that will allow it to focus on supply chain and legacy issues and agreements with General Motors Corp., according to a Friday filing with the U.S. Bankruptcy Court for the Southern District of New York.

The company's exclusive plan filing period was extended to Aug. 5, 2006 from Feb. 6 and the solicitation period to Oct. 4, 2006 from April 7.

According to the motion, the company's strategic reorganization timetable targets emergence from bankruptcy in the first half of 2007, about 14 months to 16 months beyond the current expiration of the plan exclusivity period.

Delphi said granting the extension will allow it to focus substantially all of its energy on operating and transforming its business, including stabilizing the supply chain, addressing legacy issues and reaching agreements with GM.

In addition, the sheer size and complexity of its case alone justifies an extension of the exclusive periods.

The company said its case has been further complicated by other factors, including its long history with GM and the disadvantageous labor contracts Delphi inherited from GM upon separation in 1999.

Delphi said it has expended much time and many resources during the first two months of its Chapter 11 case to stabilize its supply base.

Also, Delphi said it is in the midst of formulating its business plans, and before it can propose a plan of reorganization, it must negotiate with unions to address numerous issues, including increasingly unsustainable U.S. legacy liabilities and operational restrictions driven by collectively bargained agreements that prevent Delphi from exiting non-strategic, non-profitable operations.

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

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