Delphi Corp. (PINKSHEETS: DPHIQ), a Michigan-based automotive parts manufacturer, has announced the preliminary settlement of the securities class action pending against the company in the E.D. of Michigan. The case, originally filed in 2005, stems from Delphi’s financial restatement and subsequent bankruptcy.
The global settlement covers both ERISA and securities class action claims and has a total potential value of $342 million. The securities class action portion is as follows: “the class of purchasers of Delphi’s debt securities will receive an allowed claim and the class of purchasers of Delphi’s equity securities will receive an allowed interest in the combined amount of $204 million in Delphi’s Chapter 11 case as well as approximately $90 million in cash from other defendants and insurance carriers.” For the allowed interest in the Chapter 11 case, the investors will receive the “same treatment as Delphi’s general unsecured creditors.” Bloomberg has an article on the settlement.