By Jonathan Stamp
NEW YORK (REUTERS) – Warren Buffett said on Saturday that his conglomerate Berkshire Hathaway probably his property in the five Japanese trading houses that will increase the property.
In his annual letter to the shareholders of Berkshire, the billionaire investor said ITochu, Marubeni, Mitsubishi, Mitsui and Sumitomo to “moderately relax” limits that covered Berkshire’s ownership in 10%.
Berkshire’s investments in the companies were $ 23.5 billion at the end of 2024.
“Over time you will probably see the ownership of Berkshire of all five somewhat increasing,” Buffett wrote.
The 94-year-old Buffett also said that he and Berkshire vice-chairman Greg Abel, his designated successor as Chief Executive, are investing for the “very long term”.
“I expect that Greg and his ultimate successors will keep this Japanese position for many decades and that Berkshire will find other ways to work with the five companies productively,” Buffett wrote.
Known as “Sogo Shosha”, act Japanese trade homes in a wide range of materials, products and food, often as intermediaries, and offer logistical support.
They are also deeply involved in the real economy in areas such as raw materials, shipping and steel.
Berkshire began to invest in the trading houses in 2019, drawn by their finances compared to their low stock prices, and revealed 5% ownership interests on the 90th birthday of Buffett in August 2020.
Buffett prefers to avoid companies that he says he doesn’t understand.
He told Nikkei in 2023 that the trading houses “really look so much like Berkshire”, the Omaha, the conglomerate established in Nebraska that he has led since 1965.
Berkshire has spent $ 13.8 billion on its current companies and expected $ 812 million in dividend income in 2025, Buffett said in the shareholder letter.
“This was an investment of good value when others might have considered them as value cases,” said Cathy Seifert, an analyst at CFRA Research who assesses Berkshire a “hold”.
She said that Buffett’s comments show that Berkshire has a positive working relationship with the trading houses.
Berkshire has also issued a fixed rate, yen-nominated bonds, but Buffett said that it is looking for “currency neutrality” and has no opinion about future currency change.
The conglomerate on Saturday reported $ 1.15 billion in strange profit after taxes in 2024.
(Reporting by Jonathan Stamp, in New York; Writing by Carolina Mandl, in New York; Edit by Rod Nickel)
