Warren Buffett Responds To Speculations Surrounding Berkshire's $1B Stake In Activision And Microsoft Deal

Berkshire Hathaway Inc (NYSE: BRK-A) (NYSE: BRK-B) chairman and CEO Warren Buffett on Thursday adamantly denied that he or his colleagues at the investment firm had advanced knowledge of Microsoft Corp’s MSFT plan to buy Activision Blizzard Inc ATVI.

What Happened: The veteran value investor told the New York Post that he wanted to clear up “misinformation” about the $1 billion transaction, in which his investment firm bought shares in Activision Blizzard in the fourth quarter of 2022.

Berkshire’s firm disclosed earlier this week that it had bought 14.66 million shares, valued at $975 million, in Activision Blizzard between October and November 2021, just weeks before Microsoft bought the company for $68.7 billion.

The revelation gave rise to speculations and rumors on social media, given Buffett’s close friendship with Microsoft co-founder Bill Gates — who had in March 2020 stepped down from Berkshire’s board.

See Also: Berkshire Hathaway Bought $1B Worth Activision Blizzard Stock Before Microsoft Lapped It Up

“To sum up the facts, it was about three months after our manager’s first purchase that Microsoft announced its acquisition proposal of which Berkshire had no prior knowledge,” Buffett reportedly told the Post.

“When Microsoft files its proxy material on its proposed purchase of Activision, I would be surprised if they had even discussed a proposal with Activision in early October, although I do not know.”

Why It Matters: Buffett said the Berkshire investor made the bulk of the buys in October and bought another 15% more shares in November, at an average cost of about $77.

Microsoft announced its plan to acquire Activision Blizzard in mid-January for $95 per share.

The buys could fetch Berkshire a good profit, subject to Microsoft closing the deal.

Activision shares got hammered in the fourth quarter following allegations of sexist culture and pay discrimination between men and women.

Price Action: Activision-Blizzard shares closed 0.6% lower at $80.97 a share on Thursday and is up more than 24% since the deal was announced.

See Also: Microsoft To Acquire Activision In $68.7B Deal: What Investors Need To Know

Photo: Courtesy of Fortune Live Media via Flickr

Posted In: Warren BuffettNewsTechMedia

Ad Disclosure: The rate information is obtained by Bankrate from the listed institutions. Bankrate cannot guaranty the accuracy or availability of any rates shown above. Institutions may have different rates on their own websites than those posted on Bankrate.com. The listings that appear on this page are from companies from which this website receives compensation, which may impact how, where, and in what order products appear. This table does not include all companies or all available products.

All rates are subject to change without notice and may vary depending on location. These quotes are from banks, thrifts, and credit unions, some of whom have paid for a link to their own Web site where you can find additional information. Those with a paid link are our Advertisers. Those without a paid link are listings we obtain to improve the consumer shopping experience and are not Advertisers. To receive the Bankrate.com rate from an Advertiser, please identify yourself as a Bankrate customer. Bank and thrift deposits are insured by the Federal Deposit Insurance Corp. Credit union deposits are insured by the National Credit Union Administration.

Consumer Satisfaction: Bankrate attempts to verify the accuracy and availability of its Advertisers' terms through its quality assurance process and requires Advertisers to agree to our Terms and Conditions and to adhere to our Quality Control Program. If you believe that you have received an inaccurate quote or are otherwise not satisfied with the services provided to you by the institution you choose, please click here.

Rate collection and criteria: Click here for more information on rate collection and criteria.