Buffett's Berkshire Announces $6.7 Billion Stake in Insurer Chubb - Latest Global News

Buffett’s Berkshire Announces $6.7 Billion Stake in Insurer Chubb

(Bloomberg) — Warren Buffett’s Berkshire Hathaway Inc. announced a $6.7 billion stake in insurer Chubb Ltd. announced, ending months of uncertainty about his mysterious position in a financial company, which had previously been concealed in regulatory filings.

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Berkshire disclosed the stake on Wednesday in a filing that reflects its positions at the end of the first quarter.

The conglomerate has been building the stake since 2023, but it was not previously reported because the Securities and Exchange Commission had allowed Berkshire to keep the stock confidential. Still, separate quarterly reports showed that Berkshire’s holdings in banking, insurance and financial companies increased while the company declined in other industries, including consumer products.

“Millions of people follow what Buffett does,” said David Kass, a finance professor at the University of Maryland’s Robert H. Smith School of Business, explaining why Berkshire wants confidentiality when building large positions. “Warren Buffett would be more sensitive to the issue than others.”

Chubb shares jumped in after-hours trading, gaining as much as 9.9%.

Buffett’s Berkshire is well versed in the insurance industry and owns a number of companies including Geico and National Indemnity. The billionaire investor described Berkshire’s property and casualty insurance business as the “core” of the conglomerate and helps generate “float” that can then be reinvested.

The conglomerate has also invested in other companies in the insurance industry. Berkshire owns a stake in Aon Plc, a major broker, and has previously bet on rivals such as Marsh & McLennan Cos.

Pile of money

Buffett already announced some recent changes to his company’s holdings at Berkshire’s annual meeting in Omaha earlier this month. At the end of the first quarter, Apple Inc.’s stake was reduced to $135.4 billion as the iPhone maker struggles with a series of problems, including an antitrust fine, declining sales in China and a failed car project.

The billionaire investor praised the tech giant at the meeting, attended by Apple CEO Tim Cook, and said it would remain Berkshire’s largest investment barring dramatic changes.

Berkshire’s cash holdings reached a record $189 billion at the end of March. Buffett said at the annual meeting that it was “a fair assumption” that the company would reach $200 billion by the end of this quarter.

Funds with more than $100 million must file holding disclosures within 45 days of the end of each quarter, providing insight into the holdings of secretive money managers, including hedge funds and large family offices.

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