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Warren Buffett says he didn’t know about the Microsoft-Activision deal when he bought stock

Berkshire Hathaway’s Warren Buffett told the New York Post in an email that he and other investors at the company did not know about Microsoft’s plan to buy Activision-Blizzard before the Omaha conglomerate took a $1 billion stake in the video game company. He said he wanted to clear up “misinformation” about the deal.

When Microsoft bought Activision-Blizzard for $68.7 billion, Berkshire Hathaway bought 14.66 million shares of the company. This was before Microsoft bought the company for $68.7 billion. Because Buffett has been friends with Microsoft co-founder Bill Gates for a long time, some people were surprised by how good the timing was. Gates was on the board of Berkshire until March 2020, when he will step down.

However, in an email to the New York Post, Buffett said that the stock buys were made by “one of the two investment managers who work independently of me at Berkshire.” This is a reference to Berkshire investors Ted Weschler and Todd Combs. The stock buys were done long before the acquisition was announced.

If there was any misinformation about the purchase of Berkshire stock, Buffett said in an email that it was important for the record to be correct “after I am not around.” The email was sent to a Post reporter and two other media outlets.

Microsoft said in January that it planned to buy the video game company Activision-Blizzard.
This is how SOPA Images and LightRocket got their money: through Gett

He told the New York Post: “To sum up, it was about three months after our manager’s first purchase that Microsoft came out with its acquisition proposal, which Berkshire did not know about.” “When Microsoft files its proxy material on its plan to buy Activision, I would be surprised if they had even talked about a deal with Activision in early October, but I don’t know.”

Buffett said that the Berkshire investor bought about 85% of the stake in October and bought the rest in November for an average price of about $77.

Berkshire Hathaway bought the shares at an average price of about $66.53 per share, the Wall Street Journal first reported, but that figure has since been changed. In the end, the outlet added the $77 average price to its storey.

Call of Duty video games

Activision-Blizzard produces hit video game series such as “Call of Duty” and “Warcraft.”
Bloomberg via Getty Images
Shares of Activision Blizzard have jumped more than 24% since the deal was announced. They are now trading above $81.

That’s what Warren Buffett said. Berkshire could have bought shares of a company at the same price even if they had bought it after the deal was made public.

It’s possible that after Microsoft announced its plan, the investment manager bought $77 worth of shares at a price of $78 or so. For him, or for Berkshire, it was not a big deal at all to buy it.

In the past, Warren Buffett has tried to dispel the idea that his close relationship with Bill Gates could give him early access to Microsoft’s plans. This isn’t the first time.

Berkshire Hathaway boss Warren Buffett enjoys time with guest Bill Gates at a Berkshire Hathaway annual meeting from years' past

Berkshire Hathaway boss Warren Buffett enjoys time with guest Bill Gates at a Berkshire Hathaway annual meeting from years past.
 Bloomberg via Getty Images

On top of the fact that Gates used to be on the Berkshire board, the two are known to play bridge together. Buffett used to be on the board of the Bill and Melinda Gates Foundation.

Buffett said in 2018 that he has tried to avoid buying Microsoft stock for a long time because he was afraid that if he did, Gates would say that he told him something or that he told him something.

About the author

Akanksha Jain

Akanksha Jain love to learn new stuff every day. With a background in computer science and a passion for writing, she loves writing for Startup, Business sections of Editorials99.

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