His last big problem as CEO of Berkshire before Abel takes over?

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The agreement is based on an already close relationship between companies: Berkshire is the largest western shareholder with a participation of almost 27% currently estimated at $ 11.9 billion.

In addition, Westerner pays a dividend of 8% out of more than $ 8 billion in privileged shares held by Berkshire after what was, in fact, a loan to help Oxy to buy Anadarko Petroleum in 2019.

As part of this agreement, Berkshire also has mandates to buy nearly 84 million additional ordinary shares for just under $ 60 per share, which is greater than their current prices just under $ 45.

Despite these links, Buffett told shareholders two years ago, Berkshire would not try to acquire Western in its entirety.

In a live interview on the “Squawk Box” of CNBC in the morning of the announcement, CEO Vicki Hollub said that it would use $ 6.5 billion in the price of oxychem purchase to reduce its debt, put it below the target of $ 15 billion when it bought Crownrock, producer of Permian, at the end of 2023 Dollars.

“Now we will be able to start our action buyback program …

“The thing we had to do was improve our assessment. It is the last big step we need and now I think we have left to assess the creation that will arrive at a much faster rate for our shareholders.”

Wall Street is not as positive as Hollub concerns the agreement.

Western Petroleum shares fell 8.1% on Thursday on the day of the announcement, but then bounced a little to close the week with a decrease of 5.5%.

Barron is dull in his evaluation: “Score one for Warren Buffett to the detriment of the CEO of Western Petroleum Vicki Hollub.”

He indicates that the purchase price “could be a good deal because the profits from the sector are depressed this year” and should go.

In addition, Western will lose a chemical company that has helped to differentiate it from energy rivals.

He will also face a tax stroke of $ 1.7 billion which would have been eliminated if Berkshire had used his privileged actions Oxy to pay the agreement, as some had planned.

This means that Western will probably continue to pay more than $ 600 million in Berkshire each year until the preferred shares are planned in 2029.

Fortune, On the other hand, highlights the western advantages of the reduction of its debt load.

He quotes Wolfe’s research analyst, Doug Leggate, calling for the agreement as “win -plus for Berkshire, because he also helps the company to own (roughly) 30% of. It’s completely selfish, it is logical and not in a harmful way – very useful.”

This is how Greg Abel de Berkshire played it in the press release from the agreement which, interesting, never mentioned the name of Buffett.

“We congratulate Vicki and the Western team for their commitment to the long -term financial stability of Western, as has shown that their product use plan to strengthen the business report.”

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Warren Buffett explains how consistency helped him and Charlie Munger gradually build Berkshire Hathaway in what he is today.

The main assets of Berkshire of actions publicly disclosed in the United States, Japan and Hong Kong, by market value, depending on the closing prices today.

The assets were on June 30, 2025, as indicated in the 13F file of Berkshire Hathaway on August 14, 2025, with the exception of:

The complete list of current assets and market values ​​is available from Berkshire Hathaway Portfolio Tracker from CNBC.com.

Please send me questions or comments about the newsletter at alex.crippen@nbcuni.com. (Sorry, but we do not transfer questions or comments to Buffett himself.)

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– Alex Crippen, publisher, Warren Buffett Watch