County in touch with Delphi's new bidder

PERKINS TWP. Mark Litten was not surprised when it was announced another investment group had submit
Janet
May 24, 2010

 

PERKINS TWP.

Mark Litten was not surprised when it was announced another investment group had submitted a $75 million bid to purchase the local Delphi plant.

Litten, the executive director of the Erie County Economic Development Corp., said he has been talking to the investor group since Labor Day.

The group includes Joseph B. Anderson Jr. and Mark Davison, former General Motors auto industry veterans and leaders of TAG Holdings LLC -- the Troy, Mich., parent corporation for a diverse collection of manufacturing and service-based enterprises.

"They have been the ones who have communicated with my office the most," Litten said.

Last month, Cleveland-based Resilience Capital Partners entered into a $44.2 million asset sale and purchase agreement with Delphi Corp. for the sale of its wheel bearings business. The new bid was submitted before the Monday deadline of a bid hearing, according to a news release. If the sale to TAG Holdings is successful, the plant would be renamed Sandusky Wheel Bearings Inc.

Although Litten said he isn't a proponent of any one investment group, he said he supports anyone interested in purchasing the local facility.

"As I've said from day one, our ultimate hope is that this plant is acquired and operated because this facility is important to Erie County and the people who work there," he said. "It's not just the plant sitting out on Hayes Avenue. There's a lot of other things connected to that facility -- a lot of connections to it," he said.

The new bid includes keeping the plant's employees, who would receive 20 percent ownership in the business, the release said.

Calls to the bidder's representative, Baytree Investors, were not returned Tuesday.

Many Delphi workers said they were unaware of the new bid submitted Monday.

Craig Baun, who has worked at the plant for about two years, said he doesn't really care who purchases the plant as long as the workers keep their jobs.

"All I want to do is work," Baun said.

Another employee, who has worked at the plant since August, said he doesn't know much about the new bidders. However, he said the new group's incentive to offer 20 percent ownership of the plant to its employees "sounds interesting."

The bid also states that Sandusky Wheel Bearings' board of directors would be composed of representatives from both management and hourly employees. The bid would not require changes to the existing UAW contract, and the buyer would provide to GM an exclusive marketing plan that could help GM dealerships sell cars and improve output at the plant.

Litten said the buyer's plan to diversify the product line and allow employees to become stockholders in the company impressed him most.

"That's an interesting concept," he said. "Our ultimate hope is that it just continue operating and supplying parts to (General Motors) and maybe other automotive companies."