Buffett’s Berkshire Hathaway seeks to buy as much as 50% of Occidental

Image: Occidental Petroleum

Warren Buffett’s Berkshire Hathaway Inc. won approval from U.S. regulators to buy as much as 50 per cent of Occidental Petroleum Corp. after spending months snapping up its shares. Occidental’s stock had its biggest gain in five months.

The Federal Energy Regulatory Commission said in a filing published Friday that Berkshire’s proposed stock purchases are “consistent with the public interest.” Berkshire applied for the authorization on July 11, FERC said.

Berkshire has spent this year wagering more on Occidental after first making a bet on the Houston-based oil company three years ago. Earlier this month, Berkshire reported that it now holds 188 million shares of Occidental’s common stock, a little more than 20 per cent of its 931 million shares outstanding.

“No question Buffett goes to 50 per cent from here,” said Bill Smead, who manages $4.8 billion at Smead Capital Management Inc. and is a top 20 shareholder in Occidental and also owns Berkshire stock. “This is looking more and more like the Burlington transaction where he ended up buying the whole shooting match.”

Buffett built up a significant stake in railroad Burlington Northern Santa Fe Corp., now known as BNSF, before agreeing in late 2009 to buy the railroad.

Berkshire, based in Omaha, Neb., didn’t immediately respond to requests for comment on the FERC application.

© 2022 Bloomberg L.P.

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