BY K.O. JACKSON, Kokomo Tribune staff writer

kirven.jackson@kokomotribune.com

D-Day for Delphi Corp. is Thursday.

Friday was the deadline for credit bidders to submit counterbids for assets of Delphi.

However, the New York bankruptcy court extended the deadline until Tuesday to give Delphi, General Motors Corp., the U.S. Treasury and lenders additional time to negotiate a deal for an auction of Delphi's assets.

The deal, as presented earlier this month to bring Delphi out of bankruptcy, has the California equity firm Platinum Equity LLC, GM and Delphi agreeing to a $3.6 billion deal in which GM would provide $2.5 billion and Platinum, $500 million.

In the deal, GM would receive four Delphi plants - including Kokomo's Electronics and Safety facilities - the global-steering division, assume $1.1 billion of Delphi's debt and not seek repayment of $1.6 billion in Delphi pension claims.

Platinum's affiliate, Parnassus Holdings II LLC, would acquire much of Delphi's U.S. and foreign operations.

During an auction of the auto supplier's assets Tuesday, according to court files, 10 of Delphi's 17 classes of creditors voted against the deal with GM and Platinum. Two creditors agreed to it, and five classes didn't vote.

As a result, a final bankruptcy hearing will occur in New York Thursday. Creditors can still submit bids for Delphi, which has been in bankruptcy since 2005.

"We really don't know a whole lot about what is going on," said Ginny McMillian, president of UAW Local 292. "We know there are permanent layoffs coming, but no full details of what is happening [in the bankruptcy] has been provided to us. There are meetings scheduled the first week of August, maybe we will know something then. Right now, we are praying about how to stop the bleeding, and we hope that is real soon."

Two reasons have been presented why lenders and Delphi salaried retirees want the court to block the auto supplier from emerging from its four-year bankruptcy - the 11th largest bankruptcy in U.S. history.

Lenders are upset the Platinum deal is worth just 20 cents on the dollar. Salaried retirees could lose up to 70 percent of their pensions, and they want GM - Delphi's former parent - to take over those pensions.

In an agreement earlier this summer, GM took over pensions of hourly Delphi workers.

However, neither party objecting to the sale may be happy at the end of the day, said a bankruptcy attorney.

"Their objections to stop this are not going to work. The only strength the objector has is if they can prove the proposed sale is being done for less than its fair value," said Jeffrey A. Schreiber, of The Schreiber Law Firm LLC. "The judge will listen to them and if they can't show less value, the judge will overrule the objection.

"Unsecured debtors and retirees are going to lose money. Other people who are owed money are going to have to get in line. It's in the best interest of Delphi and all parties the details are worked out so they can consummate the sale."

Mark Barnhill, principal at Platinum Equity, said his company "supports the open and competitive process to deliver maximum value to all of Delphi's stakeholders ... We expect Delphi and General Motors to support the highest and best offer to emerge from that auction, provided the winning bidder meets certain requirements to ensure that Delphi continues to operate as a stable, long-term supplier to GM and other global automotive customers. The stakes are extremely high for Delphi, its employees and customers."

Who gets what and what happens now, neither spokesperson for GM or Delphi would speculate.

GM spokeswoman Julie Gibson said, "we have to wait and see what happens. There are a lot of things scheduled this week."

Lindsey C. Williams, director of Delphi's corporate communications, said the company may have the option of using a 363 sale to emerge from bankruptcy.

A 363 sale is similar to what Chrysler and GM used to get out of bankruptcy - selling the company's good assets and liquidating the rest.

But Williams would not address what the Troy, Mich.-based company's plan will be.

"This is the bidding process," he said. "The court issued an order and we are going through with the plan. It would be premature to report anything else. We will know more later."

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