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Warren Buffett looks to Japan, takes 5% stakes in five trading companies

Credit: REUTERS/SCOTT MORGAN

Berkshire Hathaway Inc said it has acquired slightly more than 5% of the shares in five large Japanese companies, marking a departure for Chairman Warren Buffett as he looks outside the United States to bolster his conglomerate.

Adds details about Berkshire, other investments, additional Buffett statement

Aug 30 (Reuters) - Berkshire Hathaway Inc BRKa.N said it has acquired slightly more than 5% of the shares in five large Japanese companies, marking a departure for Chairman Warren Buffett as he looks outside the United States to bolster his conglomerate.

In a statement on Sunday, Buffett's 90th birthday, Berkshire said it acquired its stakes in Itochu Corp 8001.T, Marubeni Corp 8002.T, Mitsubishi Corp 8058.T, Mitsui & Co 8031.T and Sumitomo Corp 8053.T over approximately 12 months.

Berkshire said it intends to hold the investments for the long term, and may boost its stakes to 9.9%. A Berkshire insurance business, National Indemnity Co, is holding the shares.

"I am delighted to have Berkshire Hathaway participate in the future of Japan," Buffett said in a statement. "The five major trading companies have many joint ventures throughout the world and are likely to have more.... I hope that in the future there may be opportunities of mutual benefit."

The Japanese investments will help Buffett reduce his Omaha, Nebraska-based conglomerate's dependence on the U.S. economy, which last quarter suffered its deepest contraction in at least 73 years as the coronavirus pandemic took hold.

Many of Berkshire's own operating businesses have struggled, and Berkshire this month took a $9.8 billion writedown on its Precision Castparts aircraft parts business.

Berkshire owns more than 90 businesses including the BNSF railroad and Geico car insurer outright.

It also invests in dozens of companies including Apple Inc AAPL.O, with a roughly $125 billion stake based on its holdings as of June 30, as well as American Express Co AXP.N, Bank of America Corp BAC.N and Coca-Cola Co KO.N.

Most of Berkshire's operating businesses are American, though it has acquired a handful of foreign companies including Israel's IMC International Metalworking and German motorcycle apparel retailer Detlev Louis.

Additional investments in Japan could also help Buffett reduce Berkshire's cash stake, which ended June at a record $146.6 billion

(Reporting by Jonathan Stempel in New York; Additional reporting by Bhargav Acharya in Bengaluru; Editing by Paul Simao and Christopher Cushing)

((Bhargav.Acharya@thomsonreuters.com; Outside U.S. +918061822589))

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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