Warren Buffett, the stock god, made a heavy move.
On the early morning of January 17th Beijing time, Buffett's Berkshire Hathaway announced that it had acquired the remaining 20% equity of Pilot from the Haslam family, making it a wholly-owned subsidiary of Berkshire. Previously, Berkshire acquired 80% of Pilot's shares for nearly $11 billion, resulting in a valuation of Pilot as high as $13.75 billion (approximately RMB 98.2 billion).
Buffett's wholly-owned acquisition of Pilot has attracted market attention, and some analysts have pointed out that this acquisition may be Buffett's latest move in expanding into the energy sector. According to Berkshire's annual report, Pilot's travel service centers are typically located near interstate highways, providing consumers and professional truck drivers with various services such as petroleum products, retail goods, and fast food. In 2022, Pilot sold over 13 billion gallons of fuel, mainly diesel and gasoline.
It is worth mentioning that Buffett has made a lot of money from his investments in the Japanese stock market. Since 2024, the bull market in the Japanese stock market has continued to unfold. On the morning of January 17th, the Nikkei 225 index surged 1.7%, reaching 36000 points, becoming the focus of the global market. The stock prices of the five major Japanese companies (Itochu Corporation, Marubeni, Mitsubishi Corporation, Mitsui Corporation, and Sumitomo Corporation) that Buffett continues to increase his holdings have collectively skyrocketed. After increasing his holdings, the stock prices have all set new historical highs.
Buffett, big news
On the early morning of January 17th Beijing time, Buffett suddenly made a move to acquire Pilot Travel Centers, the largest travel service center operator in the United States.
Buffett's Berkshire Hathaway announced that it has acquired the remaining 20% stake in Pilot from the Haslam family, making it a wholly-owned subsidiary of Berkshire.
The financial terms of this transaction were not disclosed. Previously, Berkshire had acquired 80% of Pilot's shares for nearly $11 billion, and based on this calculation, Pilot's valuation was as high as $13.75 billion (approximately RMB 98.2 billion).
According to the previous agreement, starting from January 1st this year, the Haslam family will sell its remaining 20% equity in Pilot to Berkshire, and the sales price will be calculated based on Pilot's revenue from the previous year.
Berkshire stated in a statement that it now owns 100% of the shares in Pilot Tourism Center. The statement also stated that Hasram's sale of Pilot will take effect immediately.
On Tuesday local time, billionaire Jim Haslam II announced in a statement announcing the sale of shares by his family, "Pilot started from a gas station 65 years ago and has now become an industry leader due to our dedicated and outstanding team members throughout history."
It is worth mentioning that Berkshire and the Haslam family once collapsed due to the acquisition price. In October 2023, the Haslam family accused Buffett's aides of modifying accounting rules, significantly lowering the value of the remaining 20% of the shares. The lawsuit may result in losses of up to 1.2 billion US dollars.
Earlier this January, the Haslam family and Berkshire reached a settlement on this lawsuit, avoiding the two-day trial originally scheduled to start on January 8th.
In addition, according to CNBC, in December 2023, federal prosecutors in New York were investigating allegations made by Berkshire Hathaway that the Haslam family attempted to bribe at least 15 executives of Pilot Company with millions of dollars to exaggerate the company's profits for 2023, as this would force Berkshire to pay a higher price for the Haslam family's remaining 20% stake in the company.
Subsequently, the Haslam family urgently denied Berkshire's claim about Haslam.
What signal?
Buffett's wholly-owned acquisition of Pilot has attracted market attention, and some analysts have pointed out that this acquisition may be Buffett's latest move in expanding into the energy sector.
According to Berkshire's annual report, Pilot is the largest travel service center operator in North America (with its main brands being Pilot or Flying J), with over 650 travel centers in 44 states in the United States and 6 provinces in Canada. Pilot also has over 150 retail locations in the United States and Canada, and currently has approximately 25500 employees.
It is reported that Pilot's travel service centers are usually located near interstate highways, providing consumers and professional truck drivers with petroleum products, retail goods, fast food, as well as various services and convenience facilities. Although Pilot's main business is operating fuel and in store travel service centers, it also signs distribution agreements with existing (third-party) travel centers where Pilot purchases and sells diesel for a fee. Pilot sold over 13 billion gallons of fuel (mainly diesel and gasoline) in total in 2022.
In addition to acquiring Pilot, Berkshire's recent increase in holdings of Western oil is also very evident.
On January 11th, Beijing time, the latest disclosure by the US Securities and Exchange Commission (SEC) showed that Berkshire's stake in Western Oil had increased to 34%. In December 2023, Berkshire continued to increase its holdings in Western Oil and bought over 15 million shares in a series of transactions, with a total cost of approximately $900 million.
In December 2023, Western Oil announced the acquisition of US shale oil and gas company CrownRock for a total value of $12 billion. CrownRock is the third largest non-public oil producer in the Permian Basin of the United States, and its business complements that of Anadarko Oil Company, which was previously acquired by Western Oil. The Permian Basin is also one of the most profitable oil and gas fields in the United States.
At the Berkshire shareholders' meeting in 2023, Buffett said, "We really like the resources, industry position, and technological level of Western oil companies in the Permian Basin. They have many high-quality oil wells and have done many beneficial things, which is a completely different oil industry."
At present, there is widespread speculation in the market that Berkshire's increase in holdings in Western Oil will ultimately achieve its goal of controlling or even acquiring as a whole.
Buffett is a deity in Japan
Since the beginning of 2024, the Japanese stock market has been soaring all the way. On the morning of January 17th, the Nikkei 225 index surged by 1.7% to stand at 36000 points, but the increase has since narrowed. As of the latest close, the index has risen by more than 6% in 2024, becoming the focus of the global market.
In 2023, the cumulative increase of Nikkei 225 reached 28.24%, ranking second in the world, only behind the US stock market NASDAQ.
In the bull market of Japanese stocks, Buffett can be said to have made a lot of money.
On April 11, 2023, Buffett visited Japan again after 12 years and announced that his investment holdings in the five major Japanese companies (Itochu, Marubeni, Mitsubishi, Mitsui, and Sumitomo) had increased to 7.4% each.
In less than two months, Buffett raised his average shareholding in the top five Japanese companies to over 8.5% through Berkshire's wholly-owned subsidiary, National Independence Company.
In a previous interview show, Buffett emphasized, "When we invest in them, we have a long-term mindset, not just want to hold them until next week, next month, or next year."
Since Buffett increased his holdings, the stock prices of the top five Japanese companies have collectively skyrocketed, all reaching historic highs.
At the same time, the Buffett effect continues to ferment, attracting more and more foreign investors to bet on Japan.
According to the latest trading trends of various investment departments released by the Tokyo Stock Exchange, overseas investors bought a net of 3.1215 trillion yen throughout 2023, reaching a new high since the beginning of Abenomics in 2013.
Driven by optimistic sentiment, major Wall Street firms have been highly optimistic about the Japanese stock market. Among them, Bank of America predicts that the Japanese stock market will reach a historic high this year, with a potential increase of 13%.
Masashi Akutsu, Chief Japan Equity Strategist at Bank of America, predicts that the Japanese stock market will soar 13% this year, reaching a historic high, surpassing its peak 35 years ago.