Billionaire Warren Buffett, who took a four-country tour of Europe less than a year ago in search of takeover targets, now says buying opportunities are presenting themselves in the US.
With a smaller pot of money remaining to fund deals, prices waning and bidders dropping out, Buffett’s Berkshire Hathaway Inc no longer needs to look overseas for acquisitions, Buffett said in a Bloomberg Television interview, portions of which will be broadcast today and tomorrow.
“The way things are going, there’s a lot of things that may be happening in the United States,” Buffett said. “The odds favor” a domestic deal for Omaha, Nebraska-based Berkshire, he said, while allowing that “I could get a call tomorrow about some company in the UK or Germany.”
The statement is a reversal for Buffett, who spent four days at press conferences and meetings in Switzerland, Germany, Spain and Italy last May to drum up potential buyouts when US opportunities were scarce. With rival bidders cut off from funds by the credit crunch and benchmark stock indexes down more than 40 per cent from a year ago, Buffett, 78, can use Berkshire’s $25.5 billion cash hoard to buy into companies almost uncontested at discount prices.
Buffett committed some of the cash in July to buy $3 billion of preferred shares of Dow Chemical Co, helping fund the takeover of Rohm & Haas Co in a deal that will pay Berkshire 8.5 per cent annually.