The Treasury Department has approved a $2.8 billion withdrawal from General Motors Corp.’s escrow account so it can purchase a “membership interest” in its former division, Delphi Corp., GM states in a regulatory filing made on Monday.
In a U.S. Securities and Exchange Commission filing, GM said it received roughly $1.7 billion to invest in Delphi, as well as $1.1 billion to acquire Delphi’s global steering business, some domestic facilities and other related payments.
Delphi, which recently emerged from bankruptcy, employs more than 1,000 people at its Lexington Avenue manufacturing location and its Henrietta engineering facility. The company was spun off GM in 1999 and filed for Chapter 11 bankruptcy protection in 2005.
In May, UAW Local 1097 president Dan Maloney confirmed GM planned to roll five Delphi facilities back into its own operations as wholly owned subsidiaries, while closing 16 other facilities, pending approval by UAW workers nationwide.
Maloney could not be reached for comment Tuesday.
GM did not disclose the size of the ownership.
The $16.4 billion escrow account was established in July. GM also has an escrow account through Export Development Canada for its Canadian subsidiary, the filing states. GM has borrowed some $50 billion from the Treasury, which owns more than 60 percent of the company, the Associated Press reported.
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