Elliott, Silver Point See Delphi Payday

Oct 28 2010 | 4:09am ET

Keeping auto-parts maker Delphi Corp. in business has cost General Motors some $12 billion. But the firm’s troubles are poised to prove highly profitable for a pair of hedge funds.

Elliott Management and Silver Point Capital could make more than $1.5 billion if Delphi goes public next year, as expected, the New York Post reports. The two hedge funds turned $2.9 billion in Delphi debt—which they acquired for about 15 cents on the dollar—into an 18% stake in the company after using their position as creditors to block the sale of Delphi to a private-equity firm that would have left lenders with almost nothing.

The stake has more than doubled in value since Delphi exited bankruptcy last October. At the time, it was worth $640 million.


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