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Ericsson may be the front-runner in race to buy Marconi
London: Swedish telecoms maker Ericsson has emerged as the highest bidder in the race to buy telecoms equipment company Marconi. The deal is reportedly worth £700mn.

Market rumours had earlier put the Chinese group Huawei as the front-runner, but it now emerges that Ericsson may have so far submitted the highest bid and is expected to buy its troubled UK rival in an agreed takeover.

Marconi put itself up for sale in April after missing out to Ericsson on a £10bn contract to supply equipment to BT that will control the transmission of phone calls over the Internet.

Ericsson is understood to be keen to take advantage of the company's long-standing relationship with BT, which is Marconi's largest customer, as well as its 4,000-strong UK workforce and technological expertise to help it to supply the 'i-node' - or brain - for BT's new network.

A spokesman for Marconi has however dismissed the speculation as "just another rumour".

The company was founded by Guglielmo Marconi in 1897 and taken over by English Electric in 1946, which then merged with GEC in 1968.
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Delphi bankruptcy filing leaves GM with an uncertain outlook
New York: General Motors Corp. has said that it could save as much as US$2bn a year as a result of the weekend bankruptcy protection filing by its largest parts supplier, Delphi Corp. The Detroit-based auto maker also warned that it could face major financial risk arising from supply disruptions as Delphi seeks to slash costs and close unprofitable operations.

In the largest auto industry bankruptcy protection filing in the USA, to date, leading U.S. auto parts supplier Delphi applied to reorganize its U.S. operations in federal bankruptcy court in New York on Saturday.

Delphi chairman Robert Miller said the company hopes to emerge from Chapter 11 by mid-2007 after slashing labour costs, including pension and health-care obligations. Miller said that Delphi will operate its business as usual in the short term even as it negotiates with the United Auto Workers and GM toward a restructuring.

Delphi lost US$4.8bn in 2004, and US$750mn in the first half of this year. The company faces billions of dollars in unfunded pension and other worker benefit obligations.

The company has 50,000 employees in the United States and 185,000 worldwide, though its international operations are not affected by the weekend bankruptcy filing.

In a statement released on the weekend, GM, which spun off Delphi in 1999, said the bankruptcy filing offers both benefits and risks. "Although the challenges faced by Delphi during its restructuring could create operating and financial risks for GM, that process is also expected to present opportunities for GM," the company said.

GM said that it does not expect immediate delivery problems, but Delphi's efforts to shed unprofitable plants and business lines could cause supply disruptions, which could force the suspension of production at GM assembly plants.
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