Berkshire Hathaway bought this week further 5.2 million shares in Occidental Petroleum, which raises its stake in the U.S. oil producer to around 27.7%, Warren Buffett’s conglomerate said in a regulatory filing with the SEC.
Between December 19 and December 21, Berkshire Hathaway bought Oxy shares at a price of around $60 per share for a total spending of about $312 million this week, the filing showed.
As of December 21, Berkshire Hathaway held a total of 243,715,804 of common stock in Oxy plus 84,897 in Series A Preferred Stock.
Last week, Buffett’s firm bought close to $590 million worth of Occidental Petroleum stock after the U.S. oil firm announced it would acquire Permian oil driller CrownRock.
Early last week, Occidental Petroleum said it buy Permian oil and gas producer CrownRock for cash and stock in a deal valued at around $12 billion, including debt.
Occidental has entered into a purchase agreement to buy CrownRock, whose over 94,000 net acres of premium stacked pay assets and supporting infrastructure “are well positioned alongside Occidental’s legacy Midland Basin business,” Oxy said on December 11, announcing the latest large acquisition in the U.S. oil industry.
Berkshire Hathaway began buying stock in Occidental last year, sparking speculation that it was going to take over the company, which it helped acquire rival Anadarko in 2019.
Buffett denied he had such plans at Berkshire’s annual shareholders’ meeting earlier this year.
“We don’t know where the price of oil will be, but we like Occidental’s position in the Permian,” Buffett told Berkshire Hathaway’s shareholders at the company’s annual meeting in early May.
“There’s speculation about us buying control, we’re not going to buy control,” Buffett added. “We wouldn’t know what to do with it.”
To date, Berkshire is Oxy’s largest shareholder. Besides the purchase warrants, the company owns $10 billion worth of Oxy preferred stock, which carries an 8% dividend.
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By Tsvetana Paraskova for Oilprice.com
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