Detroit, Michigan – General Motors has confirmed that it intends to acquire the Delphi global steering business, exercising its option under the GM/Delphi Master Restructuring Agreement. The option covers Delphi’s employees, facilities, products, technical capability and intellectual property.
A former subsidiary of the automaker and its largest supplier, Delphi has been in bankruptcy protection since 2005.
GM said that the business will be operated as a stand-alone business, much as it is today, and will be held in a wholly-owned subsidiary of GM, at least in the near term. The automaker said that a diverse customer base and the ability to self-fund the operations will be essential to the business’ long-term future.
The transaction is expected to be completed in the second quarter of 2009, although terms are not being disclosed at this time.
GM has also agreed to increase its advance agreement commitments from US$300 million to $450 million to support Delphi’s near-term liquidity needs, effective March 24, 2009. The Delphi Steering transaction and commitment advance are subject to final approval by GM’s board of directors, the U.S. Treasury, and bankruptcy court.