March 7 (Reuters) – Warren Buffett’s Berkshire Hathaway Inc (BRKa.N) has resumed its purchases of Occidental Petroleum Corp (OXY.N) shares after a five-month hiatus, rising its stake within the oil firm to about 22.2%, a regulatory submitting confirmed on Tuesday.
Berkshire paid about $355 million for five.8 million Occidental shares between March 3 and March 7, based on the submitting.
The purchases have been the primary Berkshire has disclosed since late September. It ended final yr with a 21.4% stake.
In August, Berkshire received US Federal Vitality Regulatory Fee permission to purchase as much as 50% of Occidental’s widespread inventory.
Buffett’s firm now owns about 200.2 million Occidental shares value $12.2 billion, primarily based on Tuesday’s closing worth of $60.85.
These shares would generate about $144 million of annual dividends, following a 38% enhance that Occidentally introduced final month.
Berkshire additionally owns $10 billion of Occidental most popular inventory that throws off $800 million of annual dividends, plus warrants to purchase one other $5 billion of widespread inventory.
Occidentally ended January with about 900 million shares excellent.
Berkshire started shopping for giant portions of the Houston-based firm’s inventory a few yr in the past.
After its stake surpassed 20%, Berkshire adopted the fairness technique of accounting for its holdings, and now experiences its share of Occidental’s outcomes with its personal.
Accounting guidelines usually require the fairness technique above the 20% threshold, reflecting an assumption that the holder may exert vital affect.
Berkshire ended 2022 with $128.6 billion of money and equivalents. It plans to maintain a $30 billion cushion.
Occidental’s share worth is greater than doubled in 2022, benefiting from increased oil costs after Russia invaded Ukraine.
Though fourth-quarter revenue was decrease than analysts anticipated, Occidental mentioned it deliberate to lift capital spending this yr and will repurchase as much as $3 billion of inventory.
Berkshire additionally owns dozens of firms together with Geico automotive insurance coverage, the BNSF railroad, client manufacturers comparable to Dairy Queen and Fruit of the Loom, and different shares together with Apple Inc (AAPL.O).
Reporting by Jonathan Stempel in New York; Modifying by Jamie Freed
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