The great mystery surrounding the company in which Warren Buffett invested billions of dollars comes to an end. Berkshire Hathaway has recently revealed its significant stake in the insurance company Chubb. An investment that the ‘Oracle of Omaha’ kept secret since last year.
According to several economic media reports, Berkshire Hathaway, owned by Warren Buffett, revealed a $6.7 billion stake in insurer Chubb Ltd., putting an end to months of suspense about its mysterious position in a financial firm, previously kept hidden in regulatory filings, Bloomberg Linea reports.
As the media reports, the conglomerate has been building the stake since 2023, but it had not been reported previously because the Securities and Exchange Commission allowed Berkshire to keep it confidential. However, the separate quarterly filings reflected Berkshire’s holdings in banks, insurers, and financial companies were growing, while the company was scaling back in other industries, including consumer products.
The silence of investment
The reason for the confidentiality of the investment has an explanation. “Millions of people follow what Buffett does,” said David Kass, as reported by Bloomberg Linea, a finance professor at the Robert H. Smith School of Business at the University of Maryland, explaining why Berkshire wants confidentiality while accruing large positions. “Warren Buffett would be more sensitive to the issue than others,” he stated.
In this context, Chubb’s shares rose 9.9% in after-hours trading. And it is not surprising given the nature of the business, Berkshire is closely tied to the insurance sector, as it owns a number of companies such as Geico and National Indemnity, the media adds. The billionaire investor has described Berkshire’s property and casualty insurance operations as the conglomerate’s “core,” as they help generate “float” capital that can be reinvested.
Other insurance companies
Buffett’s company has also invested in other companies in the insurance sector. It holds a stake in Aon Plc, a major insurance broker, and has previously bet on competitors like Marsh & McLennan Cos.
Chubb is one of the largest property and casualty insurers in the United States and operates in 54 countries around the world. Its CEO, Evan Greenberg, is the son of Maurice “Hank” Greenberg, who led American International Group Inc. for many years. Evan Greenberg built Chubb through the 2016 merger of Ace Ltd. and Chubb Corp., creating a massive insurer covering a range of risks including cyber attacks and maritime transport, the media concludes.
