Los Angeles private equity firm Platinum Equity is buying most of Delphi Corp., which will enable General Motors Corp.? largest supplier to emerge from Chapter 11 bankruptcy protection after more than three years.
Platinum Equity, controlled by billionaire Tom Gores, said it has lined up commitments of $3.6 billion to finance the acquisition. General Motors also will buy some of Delphi? plants, as well as its global steering business.
Parnassus Holdings II LLC, a Platinum affiliate, will operate Delphi's businesses both in the U.S. and abroad. The parts supplier, based in Troy, Mich., filed for bankruptcy in October 2005, but earlier restructuring deals had fallen through.
General Motors itself filed for Chapter 11 protection on Monday, with a restructuring plan backed by $30 billion in government financing that will reorganize its debt and reduce labor costs.
? healthy, sustainable supply base is the best foundation for any effort to revitalize the auto industry," said Gores in a statement. "Automakers need strong suppliers in order to rebuild their own businesses and return to profitability. It starts from the ground up and we look forward to contributing to that process."
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