Jonathan Stempel
New York (Reuters) – Warren Buffett said on Saturday that his conglomerate Berksshire Hathaway is likely to increase ownership in five Japanese trading houses he owns.
In his annual letter to the Berksshire shareholders, the billionaire investor said IToch, Marubeni, Mitsubishi, Mitsui and Sumitomo agreed that “moderately relaxed” limitations that have limited Berksshir’s role below 10%.
Berkshire’s investments in companies were $ 23.5 billion at the end of 2024.
“Over time, you will probably see Berkshire’s property over all five rise,” Buffett wrote.
The 94-year-old Buffett also said that he and Vice President Berksshire Greg Abel, his appointed successor as the executive director, invest in “very long-term”.
“I expect that Greg and his possible heirs of the long decade will hold this Japanese position and that Berksshire will find other ways of productive work with five companies,” Buffett wrote.
Known as “Sogo Shosha”, Japanese trade houses trade in a wide range of materials, products and food, often serve as intermediaries and provide logistical support.
They are also deeply involved in the actual economy in areas such as goods, shipping and steel.
Berksshire began investing in trading houses in 2019, attracted to their finances compared to their low shares’ prices, and discovered 5% of ownership roles on Buffett’s 90th birthday in August 2020.
Buffett prefers to avoid companies she says he doesn’t understand.
Nikkei said in 2023 that the trading houses were really so similar to Berksshire, “a conglomerate from Omaha, Nebraska, who has been leading since 1965.
Berksshire spent $ 13.8 billion on its present stakes and expects $ 812 million in dividend revenue in 2025, Buffett said in a shareholder letter.
“This was a good investment of value when others may have viewed them as traps of value,” said Cathy Seifert, an analyst from CFRA Research, who evaluates Berkshire “Hold”.
She said Buffet’s comments show that Berksshire has a positive employment with trading houses.
Berksshire also issued a fixed rate bonds, but Buffett said he was looking for a “neutrality of currency” and that he had no view of future currency changes.
The conglomerate reported on Saturday about 1.15 billion dollars of appropriation in a foreign currency after the 2024 tax.
(Reporting Jonathan Stempel, New York; Writing Carolina Mandl, New York; Mounting Rod Nickel)
