Berkshire Hathaway has announced a $9.7 billion cash acquisition of OxyChem, the chemical division of Occidental Petroleum, in what could be Warren Buffett’s final major deal as CEO before he hands over the reins to Greg Abel at year-end. The transaction is Berkshire’s largest since its $11.6 billion purchase of Alleghany Corporation in 2022, though still smaller than the “elephant-sized” deal Buffett has long sought to significantly deploy the company’s roughly $340 billion cash reserves.
Strengthening long-standing ties with Occidental
The acquisition deepens Berkshire’s already close relationship with Occidental. Buffett’s conglomerate holds nearly 27% of Occidental’s shares, a stake valued around $11.9 billion. In addition, Berkshire owns more than $8 billion in preferred shares that pay an 8% annual dividend—a position it took in 2019 to help Occidental finance its purchase of Anadarko Petroleum.
Berkshire also holds warrants to buy nearly 84 million additional shares of Occidental at just under $60 each, above the stock’s current price of around $45. Despite these links, Buffett has previously stated that Berkshire does not intend to buy Occidental outright.
Occidental looks to cut debt and restart buybacks
Occidental CEO Vicki Hollub said on CNBC’s Squawk Box that $6.5 billion of the proceeds from the sale will go toward reducing debt, helping the company meet its $15 billion leverage target set after its $12 billion acquisition of CrownRock in 2023.
“Now we’re going to be able to start our share repurchase program again,” Hollub said. “This is that last big step we needed to strengthen our balance sheet, and now we’re off and running toward faster value creation for our shareholders.”
Wall Street sees Buffett as the clear winner
While Occidental’s leadership praised the transaction, investors were less enthusiastic. Shares of Occidental Petroleum fell as much as 8.1% on Thursday before recovering slightly to end the week down 5.5%.
Barron’s described the deal bluntly: “Score one for Warren Buffett at the expense of Occidental Petroleum CEO Vicki Hollub.” The publication noted that the purchase price “could be a bargain because earnings in the sector are depressed this year” and likely to rebound.
The sale removes a chemical business that helped distinguish Occidental from other oil majors and exposes the company to a $1.7 billion tax hit that could have been avoided had Berkshire used its preferred shares to finance the deal. As a result, Occidental will continue paying Berkshire over $600 million in annual preferred dividends until the shares are redeemed in 2029.
Fortune took a more balanced view, highlighting the debt-reduction benefits for Occidental. Wolfe Research analyst Doug Leggate called it a “win-plus for Berkshire,” explaining that the deal strengthens both companies: “It’s completely self-serving, it’s logical, and—not in any nefarious way—definitely helpful.”
Notably, Berkshire Vice Chairman Greg Abel was the face of the announcement, with Buffett’s name absent from the press release. Abel commended Hollub’s team for “reinforcing the company’s balance sheet and long-term financial stability.”
Berkshire formalizes leadership transition
In a separate move, Berkshire Hathaway’s board has amended the company’s bylaws to formally separate the roles of chairman and CEO. According to an SEC filing released Friday, the change was approved on Tuesday—just three months before Greg Abel, currently vice chairman of non-insurance operations, officially assumes the CEO role on January 1. Buffett will remain chairman of the board.
Buffett’s bronze bust fetches $26,000 for charity
Although Buffett has ended his famous charity lunches, a bronze bust of the legendary investor raised $26,201 in an eBay auction this week. The sale was organized by investor Mohnish Pabrai, a longtime Buffett disciple, with proceeds benefiting the Dakshana Foundation—a nonprofit that provides educational opportunities for underprivileged students in rural India.
Buffett around the internet
- CNBC Pro (subscription): Buffett’s Japan bet discovered from a “little handbook” has surged as much as sixfold
- CNBC Make It: Jim Cramer disagrees with Buffett on a classic piece of investing advice—here’s why
- Bloomberg Opinion (subscription): Buffett may soon decide it’s time for another rail deal
- Investopedia: How Buffett’s favorite comic strip reveals the secrets of compounding and tax efficiency
Highlights from the archive
How to take a small business to the next level (2008) — Warren Buffett explains how discipline and consistency helped him and Charlie Munger gradually build Berkshire Hathaway into the powerhouse it is today.
Berkshire’s top publicly disclosed holdings in the U.S., Japan, and Hong Kong—based on market value as of June 30, 2025—were last reported in its August 14, 2025, SEC filing.
