A cover story in Business Week once asked "Is Wilbur Ross Crazy?" That was before he sold his massive stake last year in the U.S. steel industry for $4.5 billion.
The New York financier now is eyeing the troubled North American supplier industry. He has snapped up debt in bankrupt Collins & Aikman Corp. and expressed an interest last week in Delphi Corp. once it gets past its current problems.
No one is calling him crazy for buying $750 million, or 10 percent, of the bank debt of Collins & Aikman, a supplier of cockpit modules, fabrics and convertible top systems in Troy, Mich. If he can convert that debt into equity, he would gain an influential stake in the 11th largest North American supplier if it emerges from bankruptcy court.
Delphi is North America's largest auto supplier and is suffering from seemingly intractable labor and financial problems. Still, even if Delphi avoids a Chapter 11 filing, Ross, 67, has the cash and investors to take a position in Delphi common shares.
In an interview with Automotive News last week, Ross said Delphi has some good businesses but needs time to work out its "triangular relationship" with General Motors and the UAW.
Delphi is threatening to enter Chapter 11 if it doesn't get a bailout that is likely to cost GM $3 billion to buyout and take back Delphi workers.
Ross is chairman of WL Ross & Co. LLC, which manages more than $2 billion of assets.
Ross's firm already has ownership in a pair of Japanese auto suppliers and a 25 percent ownership of Oxford Automotive ApF, a supplier of large metal stampings that liquidated its U.S. holdings but operates in France.
The Holy Grail for Ross and other investors in the auto parts sector is to be the master consolidator. That was the goal of Heartland Industrial Partners LP founder David Stockman before the group's investment in Collins & Aikman tanked. Get big enough, and you can fend off automaker demands for price reductions that have bankrupted a host of big industry players.
Ross says the industry needs larger companies with less debt and greater geographical reach.
Ross said it's too early to make a play on Delphi. But together, they would have global sales of $28 billion and become a stronger player in automotive interiors.
If that sounds like a foolish bet, consider Ross's buy-up this decade of LTV Corp., Bethlehem Steel Corp. and other half-dead steel companies. They formed the basis of his International Steel Group.
With the steel business, Ross faced a capital-intensive industry, powerful unions and big customers, including the Big 3.
Last year, he sold International Steel to Britain's Mittal Steel Co., and, according to Fortune magazine, personally pocketed about $300 million.
How did the moribund steel industry prove to be such a big payoff? In a word: China. Ross sold International Steel at a time when massive Chinese steel buying lifted the fortunes of U.S. and other steel companies, says Peter Peterson, the retired director of automotive marketing for United States Steel Corp.
You may e-mail Robert Sherefkin at