TROY, Mich., April 5 (UPI) -- A $6.1-billion loan aimed at taking Delphi Corp., one of the largest U.S. auto parts suppliers, out of bankruptcy has collapsed, the company said.
The Detroit Free Press reported Saturday that one of the owners of Delphi Corp., hedge fund Appaloosa Management LP, didn't show up Friday to complete the loan paperwork and instead pulled out of its contract with the supplier.
The private equity firm claimed Delphi reneged on a deal that would have pumped another $2.5 billion into the company. Appaloosa Management objected to Delphi giving General Motors, its former owner, a larger stake in the exit loan, the newspaper said.
Together with the loan, six investors were to buy $2.55 billion in stock in the company, allowing Troy, Mich.-based Delphi to exit Chapter 11 protection.
As for Delphi's next step, the company is "prepared to pursue actions that are in the best interests of Delphi and its stakeholders," said John Sheehan, Delphi's chief restructuring officer.
