Berkshire Hathaway (NYSE: BRK.A), a conglomerate owned by Warren Buffett, recently disclosed that it acquired an additional 9.9 million Occidental Petroleum (NYSE: OXY) shares, bringing its ownership to a total of 163.4 million shares, with a stake of 17.4%.
Berkshire paid about US$584 million for the shares from Wednesday to Friday last week, at an average of US$58.98 per share. This recent purchase makes Buffett’s company the largest individual shareholder of the petroleum refiner, with the total value amounting to close to US$9.9 billion, based on Occidental’s Tuesday close of US$60.44.
In Q1 of 2022, Berkshire bought about US$7 billion worth of shares, and Buffett mentioned at the company’s annual meeting in May that he was able to purchase 14% of Occidental over just a two-week period. He also noted at the meeting that he felt that Occidental’s CEO was running the company well.
Truist analyst Neal Dingmann said in June that there’s a “good chance” that the billionaire will eventually purchase the petroleum refiner when it achieves investment-grade status.
If Buffett’s Berkshire does reach a 20% stake in the petroleum refiner, it will likely adopt the equity method of accounting for the stake and show in its results a proportional share of Occidental’s earnings.
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