Earlier in the day, a separate hedge fund - Highland Capital - filed a disclosure with the Securities and Exchange Commission saying it was dealing directly with Delphi and
The breakup between Pardus and
Until recently, it appeared a team led by Appaloosa was the clear-cut winner in the race to control Delphi. However, private-equity giant Cerberus Capital Management - a huge source of funding for the Appaloosa team - dropped out of the
Delphi's effort to find equity backers is a critical step in realizing its bankruptcy-emergence plans. The auto supplier, which is cooperating with former parent GM on several key issues, is also negotiating a wage and benefit package with its unions.
Even as Appaloosa fortifies its bid with the addition of Pardus, which holds a large chunk of Delphi shares, sources say that
In its Wednesday filing,
In addition, Highland's ideas for an equity plan are seen as being fairer to some significant current Delphi shareholders, sources say. Current Delphi shares could be wiped out when the company emerges from bankruptcy, and
One person said that while Highland's offer may be more optimal for shareholders, "this is a far more complex situation with a lot more constituencies."
A GM spokeswoman declined to comment on the matter, and Delphi officials could not immediately be reached late Wednesday.
Delphi, which lost nearly
The firms that back the Delphi deal promise to take home large fees and would profit if their investment stake in what likely will be a publicly held company were to increase as Delphi's financial performance improves.
But a condition of the original
People familiar with the labor talks say the sides are edging closer to an agreement.
GM is expected to supplement wages for its former employees working for Delphi, and the parties are trying to agree on how many Delphi-UAW jobs GM will guarantee by committing to buying products from certain Delphi plants in the