China Ministry of Commerce approves GM Delphi deal

29 September 2009 @ 10:42 am EDT

China's Ministry of Commerce has approved plans by General Motors Co to acquire certain assets of bankrupt Delphi Corp, Xinhua, the country's official news agency, reported on Tuesday.

The Delphi Flint East assembly plant is seen in Flint, Michigan June 22, 2007. Delphi Corp. said on Friday it had reached a tentative deal with the United Auto Workers and former parent General Motors Corp. intended to allow the auto parts maker to cut wages and emerge from bankruptcy.

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The approval came late on Monday and had conditions attached, including a ban on GM and Delphi on exchanging trade secrets on Delphi's other Chinese customers.

GM is purchasing Delphi's global steering business and four of the parts supplier's plants it used to own in New York and Indiana.

Delphi hopes to exit bankruptcy at month's end under control of its lenders, which have agreed to forgive nearly $3.5 billion in debt.

GM will assume more than $1 billion in Delphi obligations and waive $2 billion in claims. The automaker also plans to invest $1.75 billion and provide Delphi with loans.

A New York bankruptcy judge approved the Delphi sale in July, and a regulatory review continues.

Delphi has been in bankruptcy since 2005.

(Reporting by Melanie Lee; Editing by Jonathan Hopfner)

China Ministry of Commerce approves GM Delphi deal

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