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June 27, 2014
06:22 EDTDLPHDelphi Automotive says IRS wants company to be treated as domestic
Delphi Automotive disclosed last night that the IRS issued a Notice of Proposed Adjustment asserting that it believes Section 7874(b) applies to Delphi and that the company should be treated as a domestic corporation for U.S. federal income tax purposes, retroactive to October 6, 2009. "If we are treated as a domestic corporation for U.S. federal income tax purposes, we would be subject to U.S. federal income tax on our worldwide taxable income, including distributions, as well as deemed income inclusions from some of our non-U.S. subsidiaries," Delphi said. It added, "Notwithstanding the issuance of the NOPA, we continue to believe, after consultation with counsel, that Delphi should not be treated as a domestic corporation for U.S. federal income tax purposes. We intend to vigorously contest the conclusions reached in the NOPA through the IRS’s administrative appeals process, and, if we are unable to reach a satisfactory resolution with the IRS, through litigation. Accordingly, we will continue to prepare and file our financial statements on the basis that we are UK tax-resident. We have not recorded any adjustments with respect to this matter, nor will we record any adjustments in connection with receiving the NOPA. If we are unsuccessful in contesting the IRS’s assertion, we would not expect a material cumulative impact to our historical tax position at this time. However, we expect any unfavorable final outcome to adversely impact our tax position by increasing our annualized effective tax rate to approximately 20% to 22%. For the year ended December 31, 2013, our effective tax rate was 17%."
News For DLPH From The Last 14 Days
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February 19, 2015
08:13 EDTDLPHDetroit Economic Club to host a luncheon meeting
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05:39 EDTDLPHDelphi Automotive agrees to sell thermal business to MAHLE
Delphi Automotive announced that it has entered into a definitive agreement to sell its wholly-owned thermal business to MAHLE GmbH for cash consideration of approximately $727M, subject to closing adjustments, which represents an implied EV/LTM EBITDA multiple of approximately 9.5x. The transaction is expected to close in the third quarter of 2015, subject to regulatory approvals. Proceeds from the transaction will be used to fund growth initiatives, including acquisitions and share repurchases. Delphi and MAHLE also signed a separate letter of intent to sell Delphi’s stake in Shanghai Delphi Automotive Air-Conditioning System. Proceeds from this transaction will be in addition to the $727M paid for the wholly-owned operations. Delphi’s Thermal division had 2014 revenues of $1.6B, with approximately 6,700 employees and 13 plants globally. The results of operations of the Thermal division business will be reported as discontinued operations beginning in the first quarter of 2015.

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