Ally Financial: Hedge Funds Getting In, U.S. Government Getting Out
Ally Financial (NYSE: ALLY) is proving a popular investment with big hedge funds, while the government is getting out.
The former financing arm of General Motors (NYSE: GM) got bailed out by the Feds in 2008 as part of the Troubled Asset Relief program. The U.S. Treasury Department reduced its 37 percent stake to 16 percent in an April initial public offering.
On Thursday, Treasury said it will exit the stock by year end.
Ally, up four percent this week, was off 0.5 percent recently at $24.08 per share.
But a raft of hedge fund filings this week covering the second quarter suggests the shares' potential allure. The list includes notable activists Richard C. Perry, John Paulson, David Loeb and Howard Marks.
Loeb's Third Point hedge fund acquired 45.6 million Ally shares in the second quarter. Loeb likes the shares enough to make it his second-largest holding as of June 30, according to the filing, equal to 13.4 percent of his total portfolio.
John Paulson's Paulson & Co. established a position in Ally, acquiring two million shares in the second quarter, making Ally the firm's second-largest holding after American International Group (NYSE: AIG), another stock bailed out by the Feds.
Richard C. Perry's Perry Capital Management acquired 14.3 million shares, while hedge fund manager Stephen Feinberg is now one of Ally's largest shareholders, with 41.5 million of the company's 479.8 million shares outstanding
York Capital Management picked up a stake of 15.4 million shares and Howard Mark's Oaktree Capital acquired eight million Ally shares.
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