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OMAHA, Neb. (AP) — Warren Buffett announced his biggest deal in years Thursday with Berkshire Hathaway’s $9.7 billion acquisition of Occidental Petroleum’s chemical division.
Berkshire’s cash pile has been steadily growing for years because Buffett has been unable to find any major acquisitions at attractive prices since completing the $11.6 billion acquisition of Alleghany Insurance in 2022. Prices for big acquisitions have been driven higher in recent years by the entry of more hedge funds into the market.
OxyChem makes things like chlorine for water treatment, vinyl chloride for plastics and calcium chloride that’s used to treat icy roads along with an assortment of other chemicals. It will fit nicely within Berkshire alongside Lubrizol, which Buffett bought in 2011 for $9 billion. But Berkshire generally doesn’t consolidate its subsidiaries, so OxyChem will likely continue operating independently.
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