Delphi Buys Back Stock From GM, Uncle Sam
(Troy-WWJ) Resurgent Delphi Automotive is buying back ownership stakes from General Motors and the federal government.
The Troy-based auto supplier, two years out of bankruptcy, will pay 3.8 billion dollars for shares currently owned by GM, and $594 million for the stake now controlled by the federal Pension Benefit Guaranty Corporation.
Delphi plans to use cash and a three billion dollar credit line to make the purchases.
Delphi was spun off from GM in 1999 and entered bankruptcy protection in 2005. A private investor group bought the company when it emerged from Chapter 11 two years ago.
Delphi President/CEO Rodney O’Neal said in a statement “These transactions represent an important step in positioning Delphi to continue to increase shareholder value.”
GM expects to post a net gain of $1.6 billion from the deal.
(Copyright 2011 WWJ Newsradio 950. All Rights Reserved. The Associated Press Contributed To This Story.)