From The Detroit Free Press

DETROIT -- General Motors Corp. has agreed to keep buying car parts from Tower Automotive Inc. and will pay at least part of what it owes the company, which filed for bankruptcy after customers like GM and Ford Motor Co. cut production.

Under an agreement filed Tuesday in U.S. Bankruptcy Court in New York, General Motors will buy Tower parts for models including the GMC Sierra and Chevrolet Silverado. Sales to GM account for roughly 10 percent of Tower's revenue. The accord, which was filed under seal, requires court approval. Precise details of the agreement were not disclosed.

Tower and GM, the world's largest automaker, have both seen declines in revenue since the start of the year, due in part to a slump in automobile sales. Tower was also hurt when some automakers halted accelerated payments, and steel prices rose.

"Following months of negotiations to resolve various disputes, Tower and GM reached a global settlement of all claims between them relating to Tower's North American operations," Tower lawyer Albert Togut said in court papers. The agreement "will help to facilitate Tower's successful reorganization."

GM also agreed to buy some of Tower's assets, court papers show.

The Tower bailout is the second involving GM and an auto supplier in five days.

Copyright 2005 Detroit Free Press. All Rights Reserved.

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