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Chrysler Wants To Delay Delphi Sale

In bankruptcy filing, automaker says it didn't have time to determine if the $106 million sale of two Delphi businesses included supply contracts.

NEW YORK — Chrysler LLC has asked a bankruptcy judge to delay the $106 million sale of two Delphi Corp. businesses until the automaker can determine whether all its supply contracts are included in the deal.
 
In papers filed Friday with the U.S. Bankruptcy Court in Manhattan, Chrysler said it hadn't had enough time to analyze the sale because many of its employees weren't working during the Thanksgiving holiday.
 
Delphi, a Troy, Mich.-based auto parts supplier, has a preliminary agreement to sell the two businesses to Renco Group Inc., a New York owner of steel and mining companies.
 
On Nov. 16, Delphi sent the notice of the supply contracts to be included in the sale, according to court papers. An auction will be conducted Dec. 6 if Delphi receives more than one bid for the businesses.
 
Up for sale are Delphi's interiors operation, which makes instrument panels, and its closure-systems business, which makes doors and latches. The two businesses generate $1.3 billion a year in revenue, according to court documents.
 
Chrysler said it hasn't had time to determine if the sales of the businesses will include all its supply contracts, ''given that the notice was filed Friday evening Nov. 16, and that certain employees of Chrysler were unavailable during the holiday week.''
 
Moreover, Chrysler said it needs to determine whether any of the supply contracts with Delphi is unfulfilled and if so, by how much.
 
Delphi, the former parts unit of General Motors Corp., filed for bankruptcy in October 2005 and has been selling off ''noncore'' businesses. It is working to emerge from Chapter 11 protection in the first quarter of 2008.
 
Renco Group also owns AM General, the maker of Humvee military vehicles, according to its Web site. Renco is set to get a $2.4 million termination fee if Delphi decides to go with another bid for the businesses.
 
Delphi said the interiors and closure-systems businesses are ''fundamentally strong.'' The two units have manufacturing facilities around the world, but Delphi says they would be more profitable as a standalone entity.
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