Thursday 26 July 2012

Buffett $3 Billion Dow Preferred Stake May Be Repaid - Bloomberg

Warren Buffett’s investment in Dow Chemical Co. (DOW), which generated $255 million a year for his Berkshire Hathaway Inc. (BRK/A), may be redeemed with proceeds the chemical maker will get as part of a legal dispute with Kuwait.
Dow Chief Executive Officer Andrew Liveris said on a conference call today that the award may be used to improve the company’s finances. Asked about preferred shares, which include $3 billion held by Berkshire and $1 billion that were sold to Kuwait’s sovereign wealth fund, the CEO said, “that’s the balance sheet, and I would say it’s included.”
Dow sold the securities to help fund the 2009 purchase of Rohm & Hass Co. The preferred shares pay an 8.5 percent annual dividend. The yield is about 4 percentage points higher than on Dow’s 30-year notes due in 2041, according to data compiled by Bloomberg.

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