General Motors just announced it intends to exercise its option under the GM/Delphi Master Restructuring Agreement to acquire the Delphi global steering business. The deal includes employees, facilities, products, technical capability, and intellectual property.
Delphi would be a standalone business much as it is today and, at least in the near term, will be held in a wholly owned subsidiary of GM. A diverse customer base and the ability to self-fund the operations will be essential to the business' long-term future, the company said.
GM expects the transaction to be completed in the second quarter of 2009. Terms of the exercise agreement are not being disclosed at this time.
In addition, GM will advance agreement commitments from $300 million to $450 million to support Delphi's near-term liquidity needs, effective March 24, 2009. The Delphi transaction and increase in advance commitments are subject to final approval by the GM Board of Directors, U.S. Treasury and Bankruptcy Court.