DETROIT, Feb 4 (Reuters) - Auto parts supplier Delphi Corp said on Wednesday it has agreed to amend financial covenants under its debtor-in-possession financing in order to preserve liquidity amid a deep downturn in auto sales.
The bankrupt supplier, a former unit of General Motors Corp , reached an agreement with its lenders to modify some financial covenants and pay-down requirements, Delphi said in a filing with the U.S. Securities and Exchanges Commission.
Delphi, operating under Chapter 11 bankruptcy protection, received court approval in December to allow the company to continue to access its $4.35 billion bankruptcy financing through the first half of 2009. At that time, Delphi said it needed the liquidity amid turbulence in the credit markets.
In addition, GM has agreed to immediately accelerate $50 million in payments to Delphi as part of an exiting agreement under which GM would provide $300 million through June 30, 2009, Delphi said.
'The Company believes the amendment and accelerated GM support will enable it to preserve available liquidity given the difficult economic environment, particularly in the global automotive industry,' Delphi said in the filing.
Delphi said it is in the process of filing a motion with the U.S. Bankruptcy Court for the Southern District of New York. The hearing is scheduled for Feb. 24.
Delphi said the amendment was necessitated by the significant production volume decreases and significantly lower forecast volumes through the first quarter of 2009.
(Reporting by Soyoung Kim; editing by Richard Chang) Keywords: DELPHI/ (soyoung.kim@reuters.com; Reuters Messaging: soyoung.kim.reuters.com@reuters.net; +1 313 967 1903) COPYRIGHT Copyright Thomson Reuters 2009. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.
The bankrupt supplier, a former unit of General Motors Corp , reached an agreement with its lenders to modify some financial covenants and pay-down requirements, Delphi said in a filing with the U.S. Securities and Exchanges Commission.
Delphi, operating under Chapter 11 bankruptcy protection, received court approval in December to allow the company to continue to access its $4.35 billion bankruptcy financing through the first half of 2009. At that time, Delphi said it needed the liquidity amid turbulence in the credit markets.
In addition, GM has agreed to immediately accelerate $50 million in payments to Delphi as part of an exiting agreement under which GM would provide $300 million through June 30, 2009, Delphi said.
'The Company believes the amendment and accelerated GM support will enable it to preserve available liquidity given the difficult economic environment, particularly in the global automotive industry,' Delphi said in the filing.
Delphi said it is in the process of filing a motion with the U.S. Bankruptcy Court for the Southern District of New York. The hearing is scheduled for Feb. 24.
Delphi said the amendment was necessitated by the significant production volume decreases and significantly lower forecast volumes through the first quarter of 2009.
(Reporting by Soyoung Kim; editing by Richard Chang) Keywords: DELPHI/ (soyoung.kim@reuters.com; Reuters Messaging: soyoung.kim.reuters.com@reuters.net; +1 313 967 1903) COPYRIGHT Copyright Thomson Reuters 2009. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.