MarketWatch – A hedge fund seeking an official voice for shareholders in Delphi Corp.’s (DPHIQ) bankruptcy case told a federal judge Tuesday the company was using old financial data that make its prospects look artificially dire.<\/p>\n
Appaloosa Management L.P., one of Delphi’s largest shareholders with about 9% of its stock, has asked the auto parts maker to move ahead with a canceled shareholder meeting and on Tuesday was seeking appointment of an official committee to represent stockholders. Appaloosa contends there will be money left over for shareholders, despite Delphi’s dire projections. <\/p>\n<\/div>\n
An expert hired by Appaloosa says Delphi is using data going back to the summer of 2005 and newer data indicate Delphi will have 2006 EBITDA of $100 million and an equity value of up to $6 billion, once it cuts labor and retiree costs through its reorganization. The investment fund is headed by former Goldman Sachs Group executive David Tepper. <\/p>\n<\/div>\n
Delphi, for its part, says an equity committee isn’t warranted because it is hopelessly insolvent – noting its unsecured debt trades at between 40 cents to 70 cents on the dollar – and shareholders don’t have a chance of a recovery. The company filed for Chapter 11 in October 2005. Its January monthly operating report filed with the U.S. Bankruptcy Court in Manhattan listed assets of $13.8 billion and liabilities of $20.2 billion. <\/p>\n<\/div>\n