Buffett's Berkshire cuts crisis-era Goldman stake

Mon Nov 16, 2015 11:00am EST
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By Jonathan Stempel

(Reuters) - Warren Buffett's Berkshire Hathaway Inc (BRKa.N: Quote) on Monday said it reduced its stake in Goldman Sachs Group Inc (GS.N: Quote) by 13 percent during the third quarter, paring a successful investment it made during the height of the global financial crisis.

In a U.S. Securities and Exchange Commission filing, Berkshire said it owned 10.96 million Goldman shares worth about $1.9 billion as of Sept. 30, down from 12.63 million shares worth $2.64 billion three months earlier.

Buffett told CNBC television he sold the Goldman shares and 7 percent of his stake in Wal-Mart Stores Inc (WMT.N: Quote) to help fund Berkshire's $31.7 billion takeover of aerospace parts maker Precision Castparts Corp PCP.N, not because he soured on either company.

The billionaire has long preferred that Omaha, Nebraska-based Berkshire own whole companies rather than individual stocks. Berkshire has close to 90 operating units such as the BNSF railroad, Dairy Queen ice cream and Geico insurance.

Goldman was not immediately available for comment.

Buffett also told CNBC he was selling investments in reinsurers Munich Re (MUVGn.DE: Quote) and Swiss Re SRENH.VX, and not selling securities as a result of Friday's attacks in Paris.

Goldman turned to Buffett for support a week after Lehman Brothers Holdings Inc went bankrupt, prompting Berkshire to buy $5 billion in preferred stock plus warrants to purchase $5 billion of shares at $115 each.

After Goldman redeemed the preferred stock, Berkshire renegotiated the warrants, and acquired a smaller number of Goldman shares in a cashless transaction.   Continued...

The Goldman Sachs logo is displayed on a post above the floor of the New York Stock Exchange, September 11, 2013. REUTERS/Lucas Jackson