Berkshire Hathaway buys stake in five Top Japan Trading Companies.

Warren Buffett's Berkshire Hathaway has purchased stakes in five top companies in Japan. This is coming in the same period where the billionaire turned 90.

The announcement was made that Berkshire Hathaway acquired the stakes of about 5% in the following companies which are Itochu Corp., Marubeni Corp., Mitsubishi Corp., Mitsui & Co., and Sumitomo Corp. The stakes in these companies were bought by its insurance subsidiary which is the National Indemnity Company over the last twelve months.

The value of all the shares combined was over $6 billion as the shares of these five companies rose by at least 5% in Tokyo trading. With this 6% stake, the intention of Berkshire Hathaway is to hold the stake for a long period, with a possibility that there might be an increase in the holdings to 9.9%.

It was also revealed by Berkshire that there would be no purchase which is beyond 9.9% in any of the five companies unless they are permitted to do so by the board of directors.

The Chairman and CEO of Berkshire Hathaway, Warren Buffett said in a statement “I am delighted to have Berkshire Hathaway participate in the future of Japan and the five companies we have chosen for investment…The five major trading companies have many joint ventures throughout the world and are likely to have more of these partnerships. I hope that in the future there may be opportunities of mutual benefit.”

The general trading companies in Japan are known as “sogo shosha” import a lot of commodities that have helped to boost the Japanese economy in a lot of ways. Contributing also to globalization and rendering certain services to manufacturers.

There are currently seven major companies that are recognized as being part of the “sogo shosha”, which have extremely diversified business lines and they include, Itochu, Marubeni, Mitsubishi, Mitsui & Co., Sumitomo, Sojitz, and Toyota Tsusho. From the seven listed, Berkshire has invested in five of them, which could be seen to be a great move.

An analyst at Jefferies, by the name Thanh Ha Pham, revealed to Bloomberg that “These trading companies generate strong cash flow, they pay out a lot of dividends and they have businesses that can’t be easily replicated”

Over the years, Berkshire Hathaway has had its major holdings in some companies in the United States of America which includes, Coca Cola and Apple Inc. Pushing its investments to other countries beyond the U.S shows that Buffett is making good his intentions when he said that there was a good number of countries that he would be willing to make investments in, adding this to other businesses where they already have investments.

Berkshire Hathaway has continued to grow and branch out into various sectors and companies. With Buffett already aged 90, it would appear that he is still strong when it comes to business and making investments.

Warren Buffett's investment in Apple 

The year 2020 has been a rough year for Warren Buffett's company Berkshire, the company lost a lot of money during COVID but it made most of it back from its investment in Apple stock.  

Buffett invested $1 billion in Apple for a total of 9.81 million shares.  As of August 2020, Berkshires Hathaway's Apple stake is now worth $104 billion.  While the company lost money in the Airline industry, its stake in Apple continues to make them a huge amount of money.