By Charlie Conchie
Warren Buffett’s investment giant Berkshire Hathaway has got the go ahead from a US energy regulator to buy up to 50 per cent of oil firm Occidental Petroleum.
Buffett, who already owned a 20.2 per cent stake in the firm, applied to increase its stake on 11th July, with the Federal Energy Regulatory Commission agreeing the move was “consistent with the public interest” last week.
The news sent shares in Occidental soaring 9.9 per cent, closing up $6.41 at $71.29. Shares in the Houston-based firm have more than doubled this year on the back of rising oil prices following Russia’s invasion of Ukraine.
Investors on Friday said was capitalising on soaring share prices in oil and gas firms.
“Buffett is taking advantage of stock market participants who are foolish about the oil and gas industry and consider it a dead business,” said Cole Smead, president of Smead Capital Management Inc in Phoenix, which owns Occidental and Berkshire shares.
“Buffett thinks it can make him wealthy.”
Berkshire also owns $10bn of Occidental preferred stock, which helped finance the 2019 acquisition of Anadarko Petroleum Corp, and has warrants to buy another 83.9m common shares for $5bn.
The post Buffett’s Berkshire Hathaway gets greenlight to buy 50 per cent of Occidental Petroleum appeared first on CityAM.
