OMAHA, Neb. – The holding company for billionaire Warren Buffett bought a major stake in Apple Inc. amid a slump in Apple’s stock price due to slowing sales of the technology giant’s iPhone and other products.
Buffett’s Berkshire Hathaway Corp. purchased 9.81 million shares of Apple in the first quarter, a stake valued at $1.07 billion as of March 31, according to a filing Berkshire made Monday with the Securities and Exchange Commission.
The value of that stake has dropped since then, to about $917 million, due to further declines in Apple’s share price.
But news of Berkshire’s purchase lifted the stock Monday. Apple was up $3.26, or 3.6 percent, at $93.78 a share in midday trading.
Buffett, 85, is the second-richest American with a net worth of $66 billion, second only to Microsoft Corp. co-founder Bill Gates at $75 billion, according to Forbes.
Buffett’s wealth is derived mainly through Omaha, Neb.-based Berkshire, where for decades he has made shrewd, long-term investments in financial and manufacturing companies that earned him the nickname the “Oracle of Omaha.”
Berkshire’s major investments are in companies such as American Express Co., Coca-Cola Co. and Wells Fargo &Co.
Buffett also is well-known for mostly staying away from technology companies, which he professed not to understand fully, even though Gates sits on Berkshire’s board and the two are longtime bridge partners.
One exception: Berkshire owns a stake in International Business Machines Corp valued at about $12.3 billion.
And Buffett reportedly was not the one who picked Apple. The investment was made one of Berkshire’s stock-picking lieutenants, CNBC and the Wall Street Journal quoted Buffett as saying via email.
They also reported Buffett as saying that he might support a potential bid by Quicken Loans founder Dan Gilbert to acquire Yahoo Inc.’s internet assets, but Buffett said he would not make bid himself partly because “I don’t know the business.”
Buffett and Berkshire did not immediate respond to a request for comment.
Buffett has “always prided himself on, ‘I stick with what I know and I just don’t know tech,’” said Lawrence Cunningham, research professor of law at George Washington University and the author of four books on Berkshire.
Speaking of Berkshire’s other portfolio managers, Cunningham said “my headline for this story isn’t so much that Warren is now warm and fuzzy on tech but that his brain-trust is much larger than it has ever been.”
Berkshire likely is taking advantage of the drop in Apple’s stock price that came as Apple posted its first quarterly sales decline in 13 years and a drop in profit, largely due to a slowdown in sales of the iPhone, iPad and other devices. Apple traded above $130 a share last summer.
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