Delphi pays $46M to retiree fund

Supplier’s pension payment $323M less than feds require; bankruptcy exit months away, Miller says.

David Shepardson / Detroit News Washington Bureau

DETROIT — Delphi Corp. said Tuesday it paid $46 million into its pension fund, far short of the $369 million required under federal law. The payment came as the company’s executive chairman vowed Delphi will emerge from bankruptcy, but said it will be "months" from now, not weeks.

"We will get it done," Delphi Executive Chairman Robert S. "Steve" Miller said of the company’s emergence from bankruptcy at a meeting of the Automotive Press Association here to tout his new book: "The Turnaround Kid: What I Learned Rescuing America’s Most Troubled Companies," which went on sale Tuesday.

Miller, who was hired as CEO in July 2005, vowed Tuesday to stay with Delphi as executive chairman until it emerges from bankruptcy. The Troy-based auto supplier initially planned to exit from bankruptcy by the end of 2007, but has been repeatedly delayed as the company struggles to obtain exit financing amid a tight credit market.

Miller said he believed Delphi had fixed its business model and only had to secure financing, noting the company had been stymied in its efforts, particularly as it related to a deal it had with an investor group led by New Jersey-based Appaloosa Management LP.

Appaloosa and five other investors on April 4 withdrew an agreement to contribute up to $2.55 billion in exit financing as part of Delphi’s $6.1 billion plan, which expired today. Delphi needs "billions" to insure liquidity and to meet its pension obligations, Miller said. Delphi has said it may sue to collect a $250 million termination fee from Appaloosa.

"We believe we completed all the terms of the contract; they believe we did not," Miller said of Appaloosa. "Appaloosa will be involved in some version of the next plan. As to whether they bring more money remains to be seen," Miller said. "We have to redo the financing plan."

Delphi has pared back its financing efforts and its former parent, General Motors Corp., which spun off Delphi in 1999, has boosted to $2.83 billion the amount it has agreed to loan Delphi. GM also has agreed to take on $1.5 billion of Delphi’s unmet pension obligations. Delphi has skipped $2.3 billion in pension payments since filing for bankruptcy in October 2005. Its overall unmet pension obligation was $3.3 billion as of the end of 2007. Miller said Tuesday that unlike some other companies Delphi did not ask the bankruptcy court to transfer its pension obligations to the Pension Benefit Guaranty Corp., which has taken on other bankrupt airlines pension obligations.

He addresses the company’s bankruptcy in — appropriately — Chapter 11 of his book.

He said the book had two prior planned titles: "In the Red" and "Not Worth a Buck," referring to his decision to take a $1 a year salary as CEO at Delphi and criticism of that from some workers.

On Tuesday, he also didn’t back away from his harsh criticism in the book of UAW President Ron Gettelfinger, which drew headlines. He said he wished he had left out some of the more personal parts of the book involving his early days with his now deceased wife, Maggie.

Miller, 66, said he was unsure what he would do after leaving Delphi. He serves on United Airlines board, and said he may join other corporate boards or return to Oregon to retire. He said he could also take a job in public service or could end up at another troubled company if the opportunity arose.