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Warren Buffett’s Berkshire Hathaway passed on the opportunity to acquire Tiffany, according to the Financial Times.
The luxury jeweler overtured Buffett after receiving a takeover bid from LVMH, but the Oracle of Omaha — who in 2009 bought $250 million advantage of the company’s bonds — declined, according to people with knowledge of the matter. Buffett confirmed to the Financial Times that the dialogue took place.
In November, Tiffany’s board ultimately agreed to a $16.2 billion takeover from LVMH, whose marks include Moet & Chandon, Dom Perignon, Givenchy and Louis Vuitton.
Berkshire Hathaway’s last full-company takeover was Correctness Castparts in 2015. Without a significant increase in its buyback program, Berkshire Hathaway is now sitting on a record $128.2 billion in hard cash, third quarter filings showed.
But that’s not to say Buffett isn’t completely sitting on his hands.
In November, Berkshire bid $140 per allocation for Tech Data, although the offer was ultimately topped by Apollo Global Management, which sweetened its bid to $145 a parcel after Buffett outbid the private equity giant’s initial sum.
Also last year, Berkshire announced a $10 billion investment in Occidental Petroleum for the Anadarko takeover, and the entourage maintains large positions in Apple, Bank of America, Coca-Cola, Wells Fargo, American Express and Kraft Heinz.
“In new years, the sensible course for us to follow has been clear: Many stocks have offered far more for our money than we could apply by purchasing businesses in their entirety,” Buffett wrote in his 2018 annual report. “The companies in which we invested tendered excellent value, far exceeding that available in takeover transactions.”
Shares of Berkshire Hathaway gained 11% in 2019, analogize resembled with the S&P 500’s 29% return, leaving some investors to question why Buffett isn’t putting more money to operate.
— Read the full Financial Times report here.