DELPHI 2013 Annual Report Download - page 90

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DELPHI AUTOMOTIVE PLC
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
1. GENERAL
General and basis of presentation—“Delphi,” the “Company”, the “Successor”, “we”, “us” and “our” refer to Delphi
Automotive PLC, a public limited company which was formed under the laws of Jersey on May 19, 2011, together with its
subsidiaries, including Delphi Automotive LLP, a limited liability partnership incorporated under the laws of England and
Wales which was formed on August 19, 2009 for the purpose of acquiring certain assets of the former Delphi Corporation, and
became a subsidiary of Delphi Automotive PLC in connection with the completion of the Company’s initial public offering on
November 22, 2011. The former Delphi Corporation (now known as DPH Holdings Corp. (“DPHH”)) and, as the context may
require, its subsidiaries and affiliates, are referred to herein as the “Predecessor.” The consolidated financial statements have
been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”).
Nature of operations—Delphi is a leading global vehicle components manufacturer and provides electrical and
electronic, powertrain, safety and thermal technology solutions to the global automotive and commercial vehicle markets.
Delphi is one of the largest vehicle component manufacturers, and its customers include all 25 of the largest automotive
original equipment manufacturers (“OEMs”) in the world. Delphi operates 126 major manufacturing facilities and 15 major
technical centers utilizing a regional service model that enables the Company to efficiently and effectively serve its global
customers from low cost countries. Delphi has a presence in 32 countries and has over 19,000 scientists, engineers and
technicians focused on developing market relevant product solutions for its customers. In line with the growth in emerging
markets, Delphi has been increasing its focus on these markets, particularly in China, where the Company has a major
manufacturing base and strong customer relationships.
Corporate history—In October 2005, the Predecessor and certain of its United States (“U.S.”) subsidiaries filed
voluntary petitions for reorganization relief under Chapter 11 of the United States Bankruptcy Code (the “Bankruptcy Code”)
in the United States Bankruptcy Court for the Southern District of New York (the “Bankruptcy Court”). The Predecessor's non-
U.S. subsidiaries which were not included in the Chapter 11 Filings, continued their business operations without supervision
from the Bankruptcy Court and were not subject to the requirements of the Bankruptcy Code. On August 19, 2009, Delphi
Automotive LLP, a limited liability partnership organized under the laws of England and Wales, was formed for the purpose of
acquiring certain assets and subsidiaries of the former Delphi Corporation, its Predecessor (“the Acquisition”) on October 6,
2009 (the “Acquisition Date”), Delphi Automotive LLP acquired the major portion of the business of the Predecessor and
issued membership interests to a group of investors consisting of lenders to the Predecessor, General Motors Company (“GM”)
and the Pension Benefit Guaranty Corporation (the “PBGC”).
As a result of the Acquisition, Delphi Automotive LLP acquired a significant portion of the business of the Predecessor
and this business constituted the entirety of the operations of the Successor.
On March 31, 2011, all of the outstanding Class A and Class C membership interests held by GM and the PBGC were
redeemed, respectively, for approximately $4.4 billion. The redemption transaction was funded by a $3.0 billion credit facility
entered into on March 31, 2011 (the “Credit Facility”) and existing cash. Refer to Note 11. Debt and Note 15. Shareholders'
Equity and Net Income Per Share for additional disclosures.
On May 19, 2011, Delphi Automotive PLC was formed as a Jersey public limited company, and had nominal assets, no
liabilities and had conducted no operations prior to its initial public offering. On November 22, 2011, in conjunction with the
completion of its initial public offering by the selling shareholders, all of the outstanding equity of Delphi Automotive LLP was
exchanged for ordinary shares of Delphi Automotive PLC. As a result, Delphi Automotive LLP became a wholly-owned
subsidiary of Delphi Automotive PLC. The transaction whereby Delphi Automotive LLP became a wholly-owned subsidiary of
Delphi Automotive PLC had no accounting effects.
2. SIGNIFICANT ACCOUNTING POLICIES
Consolidation—The consolidated financial statements include the accounts of Delphi and U.S. and non-U.S. subsidiaries
in which Delphi holds a controlling financial or management interest and variable interest entities of which Delphi has
determined that it is the primary beneficiary. Delphi’s share of the earnings or losses of non-controlled affiliates, over which
Delphi exercises significant influence (generally a 20% to 50% ownership interest), is included in the consolidated operating
results using the equity method of accounting. All significant intercompany transactions and balances between consolidated
Delphi businesses have been eliminated.
During the year ended December 31, 2013, Delphi received dividends of $30 million from two of its equity method
investments. The dividends were recognized as a reduction to the investment and represented a return on investment included
in cash flows from operating activities. During the year ended December 31, 2012, Delphi received a dividend of $62 million