Delphi Corp., Troy, Mich., will not assume responsibility for its pension plans when it emerges from Chapter 11 bankruptcy protection, under modifications to its reorganization plan filed Monday in U.S. Bankruptcy Court in New York.
According to a Delphi news release, the remaining assets and liabilities of Delphis hourly pension plan will be addressed by GM. GM accepted $2.1 billion of net unfunded liabilities for the hourly pension plan on Sept. 29.
Delphis combined defined benefit plans totaled $6.147 billion as of Dec. 31, according to its annual report.
Delphi said in its release that it explored numerous alternatives for the salaried plan and plans of certain subsidiaries, but none was feasible and as a result, the PBGC may initiate involuntary termination of the companys salaried pension plan.
The Delphi statement said the Pension Benefit Guaranty Corp. is expected to enter into a settlement with Delphi that will result in the PBGC getting an unsecured claim once the firm emerges from Chapter 11.
PBGC spokesman Jeffrey Speicher said the agency has not reached a final settlement with Delphi, has not decided to terminate the Delphi plans and has held a substantial unsecured claim against the auto parts maker since it went into bankruptcy protection in October 2005.
Delphi spokesman Lindsey Williams did not return a call seeking comment.
The release said that as part of the new plan, Parnassus Holdings II, an affiliate of private equity manager Platinum Equity, will acquire and manage Delphis U.S. and non-U.S. operations after the bankruptcy for $3.6 billion. GM will provide Delphi with up to $250 million of capital through July 31 as part of the reorganization. GM will acquire some of Delphis U.S. manufacturing operations and its global steering business.
The approval hearing for Delphis revised reorganization plan is scheduled for July 23.