Warren Buffett’s Berkshire Hathaway Inc (BRKa.N) purchased another 1.94 million shares of Occidental Petroleum Corp (OXY.N), giving it an $11.4 billion stake and putting it nearer a threshold where it could record some of the oil company’s earnings with its own.
Berkshire’s latest purchases from July 14 to July 18 cost $112 million, and gave Buffett’s conglomerate; a 19.4% stake in Occidental, or 181.7 million shares, regulatory filings show.
If it reached 20% ownership, Berkshire could report its proportionate share of Houston-based Occidental’s earnings, through the so-called equity method of accounting, potentially adding billions of dollars to annual profit.
Analysts on average expect Occidental to post about $10.7 billion of net income this year, according to Refinitiv I/B/E/S.
Occidental shares closed up 4.6% at $62.82 on Tuesday. The share price has more than doubled this year, benefiting from rising oil prices following Russia’s invasion of Ukraine.
Omaha, Nebraska-based Berkshire also has warrants to buy another 83.9 million Occidental shares for $5 billion.
-REUTERS.
