Warren Buffett’s Berkshire Hathaway (BRK.A) - Get Berkshire Hathaway Inc. Class A Report undefined disclosed it has bought into five of Japan’s biggest trading companies, bolstering his firm’s bet on a rebound in the commodities sector and some of the biggest firms that trade them.
In a statement, Berkshire said it has acquired stakes of roughly 5% each in Itochu, Marubeni, Mitsubishi, Mitsui and Sumitomo over the past 12 months. All of the firms publicly trade on the Tokyo Stock Exchange.
“I am delighted to have Berkshire Hathaway participate in the future of Japan and the five companies we have chosen for investment,” Buffett, who turned 90 over the weekend, said in the statement. “The five major trading companies have many joint ventures throughout the world and are likely to have more of these partnerships. I hope that in the future there may be opportunities of mutual benefit.”
The investments were valued at more than $6 billion combined after shares of all five companies jumped at least 5% in Tokyo trading on Monday, according to Bloomberg. Japan’s benchmark Topix index rose as much as 1.9% on Monday.
While keeping cautious on deploying Berkshire’s record $146.6 billion in cash holdings, the value investing-focused conglomerate has been adding to its commodities exposure, with deals including a $4 billion agreement to purchase most of Dominion Energy’s (D) - Get Dominion Energy Inc Report natural gas pipeline and storage assets in July, and more recently a $562 million position in Barrick Gold (GOLD) - Get Barrick Gold Corporation Report.
Most of the Japanese companies targeted by Berkshire are major players in the country’s energy and raw-materials industries.
Berkshire said it plans to hold the Japan investments for the long term and has pledged to only own as much as 9.9% of the shares in any of the five companies, unless given specific approval by each of the trading firms' boards of directors.
Berkshire's class B shares were down 0.23% at $218.10 in trading on Monday.