Warren Buffett Watch: His last big deal as Berkshire CEO before Abel takes over?

The woody builds connected an already adjacent narration betwixt the companies:  Berkshire is Occidental's largest shareholder with a stake of astir 27% presently valued astatine $11.9 billion.

In addition, Occidental is paying an 8% dividend connected much than $8 cardinal successful preferred shares held by Berkshire aft what was, successful effect, a indebtedness to assistance OXY bargain Anadarko Petroleum successful 2019.

As portion of that deal, Berkshire besides present holds warrants to bargain astir 84 cardinal further OXY communal shares for conscionable nether $60 per share, which is higher than their existent terms conscionable nether $45.

Despite those ties, Buffett told shareholders 2 years ago Berkshire volition not effort to get Occidental successful its entirety.

In a live interrogation connected CNBC's "Squawk Box" the greeting of the announcement, CEO Vicki Hollub said it volition usage $6.5 cardinal of the OxyChem acquisition terms to trim its debt, bringing it beneath the $15 cardinal people acceptable erstwhile it bought Permian Basin shaper CrownRock in precocious 2023 for $12 billion.

"Now we're going to beryllium capable to commencement our stock repurchase programme again ...

"The happening that we needed to bash was amended our equilibrium sheet. So this is that past large measurement that we request and present I deliberation we're disconnected and moving to worth instauration that's going to travel astatine a overmuch faster gait for our shareholders."

Wall Street isn't arsenic affirmative arsenic Hollub is astir the deal.

Occidental Petroleum shares fell arsenic overmuch 8.1% connected Thursday, the time of the announcement, but past bounced backmost a spot to adjacent retired the week with a 5.5% drop.

Barron's is blunt in its assessment: "Score 1 for Warren Buffett astatine the disbursal of Occidental Petroleum CEO Vicki Hollub."

It says the acquisition terms "could beryllium a bargain due to the fact that net successful the assemblage are depressed this year" and are expected to caput higher.

In addition, Occidental volition beryllium losing a chemic concern that helped differentiate it from vigor rivals.

It volition besides beryllium facing a $1.7 cardinal taxation deed that would person been eliminated had Berkshire utilized its OXY preferred shares to wage for the deal, arsenic immoderate had anticipated.

That means Occidental volition astir apt proceed to wage Berkshire much than $600 cardinal successful dividends each twelvemonth until the preferred shares are scheduled to beryllium redeemed successful 2029.

Fortune, on the different hand, highlights the benefits to Occidental of reducing its indebtedness load.

It quotes Wolfe Research expert Doug Leggate calling the woody a "win-plus for Berkshire due to the fact that it besides helps the institution that they ain [roughly] 30% of. It's wholly self-serving, it's logical, and—not successful immoderate nefarious way—definitely helpful."

That's the mode Berkshire's Greg Abel played it in the deal's quality release that, interestingly, ne'er mentioned Buffett's name.

"We commend Vicki and the Occidental squad for their committedness to Occidental's semipermanent fiscal stability, arsenic demonstrated by their program to usage proceeds to reenforce the company's equilibrium sheet."

Berkshire's apical holdings of disclosed publically traded stocks successful the U.S., Japan, and Hong Kong, by marketplace value, based connected today's closing prices.

Holdings are arsenic of June 30, 2025, arsenic reported in Berkshire Hathaway's 13F filing on August 14, 2025, but for:

• Itochu, which is arsenic of March 17, 2025, and Mitsubishi, which is arsenic of August 28, 2025. Tokyo Stock Exchange prices are converted to U.S. dollars from Japanese yen.

The afloat database of holdings and existent marketplace values is disposable from CNBC.com's Berkshire Hathaway Portfolio Tracker.

Please nonstop immoderate questions oregon comments astir the newsletter to maine at alex.crippen@nbcuni.com. (Sorry, but we don't guardant questions oregon comments to Buffett himself.)

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Also, Buffett's yearly letters to shareholders are highly recommended reading. There are collected here connected Berkshire's website.

-- Alex Crippen, Editor, Warren Buffett Watch