John Paulson’s Paulson & Co filed on December 2nd for its 51.74 million shares ownership in Delphi Automotive (DLPH), corresponding to a 15.8% passive stake. According to Bloomberg, John Paulson paid 67 cents per shares in Delphi years ago when the company filed bankruptcy. Previously Delphi was General Motors’ electronics parts subsidiary. The company initial offered at $22 for 24 million shares on November 16th, and most shares were sold by John Paulson. As a result, John Paulson and his Paulson & Co might have gained more than $400 million in this investment.
Paulson & Co was started in 1994 by John Paulson, who became famous for his bets against subprime mortgages. Before that he was relatively unknown and pursuing a merger arbitrage strategy with mediocre returns. In 2010, he made $5 Billion by betting on gold. John Paulson is not a great stock picker. His strength is in macro-themed investments. He doesn’t pick a single or a couple of stocks from a sector. He picks a bunch of stocks from each sector in which he invests.
Per Google Finance, Delphi Automotive LLP is “a global vehicle components manufacturer and provides electrical and electronic, powertrain, safety and thermal technology solutions to the global automotive and commercial vehicle markets. It is a vehicle component manufacturer, and its customers include the 25 automotive original equipment manufacturers (OEMs) in the world. As of August 19, 2011, it operated 110 manufacturing facilities and 15 technical centers utilizing a regional service model, which enables it to serve its global customers. Its business is diversified across end-markets, regions, customers, vehicle platforms and products.”