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Transportation equipment industry

Ripplewood Holdings in Talks to Bid for Delphi

Strategic Insights

— 1 min read

Brett Cole NEW YORK: Ripplewood Holdings, a buyout firm, is in discussions with Delphi and its unions that may result in a bid for the bankrupt auto-parts maker. Thomas Stallkamp, a Ripplewood partner and former Chrysler president, has been leading talks with Delphi and the United Automobile Workers union for over a year. Agreement with the UAW is crucial for a buyout firm's success, as labor costs are a significant factor in the restructuring process. Multiple private equity firms, including Cerberus Capital Management and Appaloosa Management, have also expressed interest in buying a stake in Delphi.

Key Takeaways:

  • Ripplewood Holdings, a buyout firm, is in discussions with Delphi and its unions for a potential bid.
  • Thomas Stallkamp, a Ripplewood partner and former Chrysler president, has been leading talks with Delphi and the United Automobile Workers union for over a year.
  • Agreement with the UAW is crucial for a buyout firm's success, as labor costs are a significant factor in the restructuring process.
  • Multiple private equity firms, including Cerberus Capital Management and Appaloosa Management, have expressed interest in buying a stake in Delphi.
  • A report from The Wall Street Journal first disclosed Ripplewood's interest in Delphi on Saturday.
  • Delphi's U.S. operations filed for Chapter 11 bankruptcy protection a year ago.
  • The company has remained profitable in Europe, South America, and Asia, according to a company spokesman.
  • A settlement between Delphi and its unions would require restructured labor agreements and the elimination of legacy costs.
  • The negotiations include discussions with multiple parties, including private equity firms and Delphi's creditors.

Statistics:

  • 1995: The year Ripplewood Holdings was founded by Tim Collins, a former managing director at Onex.
  • 1999: The year Delphi was spun off from General Motors.
  • $50,000: The amount UAW workers were offered by Delphi CEO Steve Miller as part of a potential settlement.
  • $27: The hourly wage of UAW workers prior to negotiations.
  • $22: The proposed hourly wage of UAW workers as part of a phased reduction.
  • $16.50: The proposed hourly wage of UAW workers as part of a further phased reduction.
  • 12.50: The proposed hourly wage of UAW workers as part of the phase reduction.
  • 5: The number of people with knowledge of the negotiations between Delphi creditors and GM.

Sources:

  • The Wall Street Journal (report)
  • Delphi (company spokesman, Steve Gaut)
  • Delphi (spokesman, Lindsey Williams)
  • Ripplewood Holdings (spokesman, Jeff Taufield)
  • Morgan Keegan (analyst, Pete Hastings)
  • Onex (former managing director, Tim Collins)

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