Investors boost Delphi

DETROIT (AP) _ Auto parts supplier Delphi Corp. said Monday it has accepted a $3.4 billion investment from a group of private equity companies to support its emergence from bankruptcy protection.

Under the deal, affiliates of Appaloosa Management LP, Cerberus Capital Management LP and Harbinger Capital Partners Master Fund I, as well as Merrill Lynch & Co. and UBS Securities LLC, would invest in the company.

Delphi employs about 8,000 hourly workers in Ohio in the Dayton, Warren, Columbus and Sandusky areas.

The investment group will invest a minimum of $1.4 billion and a maximum of $3.4 billion in the struggling company in exchange for common and preferred stock that will be issued in the first half of next year.

The money will be used to fully fund Delphi's pension plan, which at the end of 2005 was underfunded by $4.1 billion, the company said.

Troy-based Delphi, the nation's largest auto parts supplier, said the agreement was part of a plan to emerge from bankruptcy protection by the second quarter of 2007. A reorganization framework agreement, signed by Delphi, the investors and former parent General Motors Corp., was included in the deal.

Separately, Delphi accepted a proposal from JPMorgan Chase Bank 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.

''Today's agreements represent significant milestones in Delphi's reorganization and another major step towards emergence from our Chapter 11 reorganization in the U.S.,'' Delphi Chairman and Chief Executive Officer Robert S. ''Steve'' Miller said in a statement.