DETROIT/NEW YORK (Reuters) -- Billionaire investor Wilbur Ross is among those considering a bid for the assets of bankrupt auto parts supplier Delphi Corp., two people with knowledge of the matter said.

Hedge fund Elliott Management is also preparing a credit bid for Delphi, which was spun off by General Motors in 1999, the sources said.

The interest by both investors could complicate an effort by Delphi to complete a deal to sell its assets to GM and private equity firm Platinum Equity.

Delphi could not be immediately reached for comment.

"As you know, our policy is not to comment on rumors," Ross said in an e-mail to Reuters.

Ross has built his interiors business in part by combining the former Collins & Aikman Corp. with Lear Corp.'s interiors unit.

He has also has been known as a consolidator in other distressed industries, such as steel and coal. In an interview in December, Ross said he did not see how Delphi would survive a GM bankruptcy.

Drain on GM

The Delphi bankruptcy, now approaching its fourth year, has been a cash drain for GM, which has been operating under Chapter 11 protection since June 1 as it seeks permission to sell most of its assets to a new company funded by the U.S. Treasury.

As part of a deal brokered by the Obama administration's auto task force, GM would take over Delphi's steering business and four other U.S. plants.

The rest of the Delphi business, which includes its international operations, would be sold to Platinum in a $3.6 billion deal.

GM has said it has agreed to provide $2 billion in funding to Platinum, of Beverly Hills, Calif.

Platinum said it was confident its bid would be approved by the bankruptcy court overseeing the Delphi reorganization.

"As Delphi's court supervised bankruptcy reorganization reaches culmination, we are confident that our offer will be validated as the highest and best before the court," Platinum principal Mark Barnhill said in a statement.

"We have never been the only prospective bidder in the process, nor even necessarily the favored bidder. But we have persevered with only one objective: Putting the strongest and most comprehensive solution on the table and delivering value for all of Delphi's stakeholders."

Supporting Platinum

In a statement filed with the bankruptcy court last month, Delphi CFO John Sheehan supported the proposed Platinum deal and detailed the negotiations involving the company, GM and U.S. government officials that had led to it.

But Elliott Management opposes the Platinum offer on the grounds it undervalues Delphi's assets and has said it would make a credit bid using the amount it is owed under Delphi's bankruptcy loan.

Through affiliate firms, Elliott purchased a large share of Delphi's debtor-in-possession financing in the secondary market in June, according to two people with knowledge of the transaction.

Until that point, hedge fund Silver Point Capital had led a group of DIP lenders in negotiations with Delphi and U.S. officials in seeking a larger recovery in cash and ownership of a reorganized company, court filings show.

The amount of Delphi's bankruptcy loan held by Elliott has not been disclosed.

New investor

In his affidavit, Sheehan said a new investor had become the largest bankruptcy lender in June at a time when the largest tranche of those loans was trading near 20 cents on the dollar. The statement did not identify Elliott by name.

Delphi has $3.29 billion in outstanding DIP financing, with over 80 percent of that in a "Tranche C" facility projected to recover about 20 cents on the dollar under the Platinum deal.

In a win for Elliott, the U.S. bankruptcy judge overseeing the case denied earlier this week a request from Delphi that would have reimbursed Platinum up to $30 million in expenses if its proposed deal is unsuccessful.

Judge Robert Drain said the $30 million payout was "not reasonable or appropriate."

A court hearing on the Delphi sale is scheduled for July 23.