GM Considering Pumping More Money Into Delphi
GM must have a lot more cash laying around than they're letting on. The Wall Street Journal [sub] reports The General is thinking seriously about taking on more of Delphi's pension liabilities on top of the $1.5b they've already agreed to assume. In an SEC filing last month, Delphi stated their pension fund is short about $3.8b; how much of that extra $2.3b GM is thinking about taking on is anyone's guess. However, experts say getting the pension money from their sugar daddy will grease the skids for six major investors who had planned to pump $2.55 into the company. The investors are threatening to take their money and run if Delphi can't get everything straightened out by Friday, so expect GM to act quickly. Then all Delphi has to do is come up with $6.1b in debt financing to exit Chapter 11. Piece o' cake!
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GM does appear to have a "rainy day fund." Looking at the AA strike, Gm has 30 + plants idle. I think they have close to 50+ plants. That's a lot of real estate to deal. And in plant machinery and equipment.
Vehicle sales are decreasing as the country teeters on recession. Parts suppliers Delphi, American Axle, and Plastech are in or near bankruptcy. WOW, what a story. Better than any currect TV drama. And no author has ever written a fantasy to equal the high salaries the executives pay themselves. Thank you "TheTruthAboutCars" keep us informed.
Let's see...Delphi is broke, unprofitable and owes more than it's worth. You'd think there'd be a lot more businesses eager to invest in this hot prospect! Or are all six "investors" bound and gagged, have guns pointed at their heads, and are being handed pens and checkbooks?
Does anyone know what happened with Delphi's problems with their earnings statements. I'll bet no one went down for the creative book keeping that hid the symptoms until the patient was near death.