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Treasury said no to GM-Delphi deals

Posted Tuesday, Apr 28, 2009, 12:30 pm in Employee News

The U.S. Treasury blocked moves by General Motors Corp. to increase payments to its former parts subsidiary Delphi Corp., which has been reorganizing under Chapter 11 bankruptcy protection since 2005, and to acquire the supplier’s steering business, the Detroit Free Press reported.

In a regulatory filing that details GM’s restructuring plan, the automaker said that the Obama administration’s automotive task force—which has the authority to reject transaction of more than $100 million—did not approve a deal that would have moved Delphi’s unwanted steering business to GM, the Free Press said.

The task force also rejected a plan to add another $150 million to GM’s funding to the supplier, which was aimed at keeping the cash-strapped company operating through May, the paper reported. The rejections have resulted in what is now a shorter timetable for Delphi to resolve its bankruptcy case, the story said. (Detroit Free Press)
 
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