Buffett’s Berkshire Bolsters Ally and Activision Holdings; Verizon sheds

By Jonathan Stempel

(Reuters) – Berkshire Hathaway Inc, led by billionaire Warren Buffett, has tripled its stake in online banking firm Ally Financial Inc and raised its bet that “Call of Duty” video game maker Activision Blizzard Inc will be acquired by Microsoft Corp.

In a Monday regulatory filing outlining its U.S.-listed equity investments as of June 30, Berkshire also said it had exited what was once an $8.3 billion investment in Verizon Communications Inc and no longer owned Royalty. Pharma Plc, which buys drug royalties.

The filing doesn’t say whether Buffett or his portfolio managers Todd Combs and Ted Westchler made specific buys and sells, but investors often try to emulate what Berkshire is doing. Larger investments are normally those of Buffett.

Berkshire slowed its stock-buying spree in the second quarter as U.S. stock markets fell, buying $6.2 billion worth of shares and selling $2.3 billion. It had bought $51.1 billion and sold $9.7 billion in the first quarter.

Nonetheless, Buffett’s conglomerate, which also owns dozens of companies such as railroad BNSF and auto insurer Geico, ended June with a $327.7 billion stock portfolio, led by 125, $1 billion in Apple Inc.

He also invested more than $33 billion in two oil companies, Chevron Corp and Occidental Petroleum Corp, as oil prices soared after Russia invaded Ukraine.

Berkshire has since purchased an additional $1.7 billion of Occidental shares, increasing its stake to 20.2%. He also owns $10 billion of Occidental preferred stock.

In the second quarter, Ally’s stake in Berkshire fell from about 9 million to 30 million shares, while its stake in Activision rose to 68.4 million shares, worth 5.3 billion, compared to 64.3 million.

Activision’s investment is a form of arbitrage, where Buffett appears to be betting that investors are pessimistic that regulators will approve Microsoft’s proposed $68.7 billion takeover of the company.

According to Monday’s filing, Berkshire also increased its stakes during the second quarter in Apple, Celanese Corp, Chevron, Markel Corp, McKesson Corp, Occidental and Paramount Global.

It has reduced its stakes in General Motors Co, Kroger Co, Store Capital Corp and US Bancorp, according to the filing.

(Reporting by Jonathan Stempel in New York, editing by Franklin Paul and Josie Kao)

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