From AFX News Limited

DETROIT -- A federal bankruptcy court judge on Monday approved Delphi Corp.'s request to extend deadlines with General Motors Corp. and the Internal Revenue Service as it attempts to line up the financing it needs to exit from bankruptcy.

The agreement with the IRS, which was set to expire Monday, will now expire April 7. Under the agreement, the IRS will continue pension-funding waivers first granted in 2007. Without the waivers, Delphi says it could face a tax claim of $1.4 billion, which it says would actually result in its pensions being over funded.

The agreement with GM, which was also set to expire Monday, will now expire April 15. The agreement transfers billions in pension liabilities to GM, Delphi's former parent.

In requests filed with the U.S. Bankruptcy Court earlier in March, Delphi said it would be unable to emerge from bankruptcy by Monday and needed both agreements extended until after the date it expects to emerge. Judge Robert Drain agreed to the extensions after a brief hearing.

Navigating a rocky credit market and a formal investigation against some investors Delphi said may have been short-selling its stock or debt, the Troy, MI-based auto supplier expects to get the $6.1 billion in financing it needs to exit from bankruptcy by Friday, spokesman Lindsey Williams said.

A consortium of investors led by the hedge fund Appaloosa Management LP has agreed to back a $2.55 billion investment in Delphi, but only if the company raises its exit loans by Friday.

Delphi has been under bankruptcy protection since 2005.

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