said Monday that it will receive up to $3.4 billion in private equity capital to finance its emergence from bankruptcy in the second quarter of 2007.
largest auto parts supplier and former subsidiary will get the funding from Appaloosa Management, Cerberus Capital Management and Harbinger Capital Partners Master Fund I, as well as
and UBS Securities.
The deal is part of a reorganization framework agreement signed by Delphi, the investors and GM. Delphi said it will file motions seeking approval of the agreements with the U.S. bankruptcy court of the Southern District of New York and will be filing the relevant agreements this week with the
Securities and Exchange Commission
. A court hearing for the plan was set for Jan. 5.
"Today's agreements represent significant milestones in Delphi's reorganization and another major step forward towards emergence from our Chapter 11 reorganization in the U.S.," Delphi said in a statement. "The agreements announced today demonstrate real progress toward that objective."
GM's fortunes are closely tied to Delphi's survival, since its own financial health depends on a steady flow of parts to its manufacturing plants. It has been a major player throughout the bankruptcy process, shouldering much of the financial burden and trying to broker a deal in the heated negotiations between Delphi and the United Auto Workers union over salaries and benefits.
Delphi also accepted a proposal from
and a group of lenders to refinance the company's existing $2 billion debtor-in-possession credit line and about $2.5 billion in loans.