By Jonathan Stempel
(Reuters) – Warren Buffett’s Berkshire Hathaway Inc announced on Friday that it had acquired a $ 549.1 million stake in Kroger Co and invested in the largest US supermarket chain as smaller rivals struggle.
In a regulatory filing listing December 31 investments in the United States, Berkshire also announced that it had acquired a new $ 648,000 stake in the drug company Biogen Inc, valued at $ 192.4 million, and its stake at two major banks, Wells Fargo & Co and Goldman, Sachs Group Inc.
Berkshire has sold more than 86 million shares, or 21% of its Wells Fargo stake, since June 30 as the bank tries to restore its reputation following customer abuse scandals.
Since the outbreak of the scandals in September 2016, the Standard & Poor’s 500 has increased by 55%, while Wells Fargo has fallen by 3%. Berkshire started investing in Wells Fargo in 1989.
Kroger shares rose 3.9% and Biogen shares rose 1.5% after close of trading. This is a sign of investor appreciation for Buffett and the Omaha, Nebraska-based conglomerate that he has operated since 1965.
Investors are monitoring Berkshire’s quarterly filings to see where Buffett and his portfolio managers Ted Weschler and Todd Combs, who is also chief executive officer of Berkshire’s Geico auto insurer, see the value.
The Friday filing does not say who bought or sold certain stocks, although Buffett typically leads large investments such as Wells Fargo and Apple Inc, Berkshire’s largest.
Buffett’s assistant, along with Kroger and Biogen, did not immediately respond to requests for comments.
Kroger, in which Berkshire announced 18.94 million shares, has invested heavily to expand online, improve business and improve deliveries, with Walmart Inc and Amazon.com Inc, the latter also a Berkshire holding, to compete.
Many smaller chains were worse off, and Earth Fare, Fairway and Lucky’s have filed for bankruptcy protection this year. Kroger had invested in Lucky’s.
Berkshire’s Wells Fargo stake fell 15% to $ 323.2 million in the quarter, worth $ 17.4 billion, followed by its stakes in Bank of America Corp and American Express Co.
Goldman’s stake shrank 35% to $ 12 billion in 12 million shares. This investment originated in Buffett’s lucrative venture into Goldman preference shares during the 2008 financial crisis.
Berkshire also has more than 90 operations, including Geico, the BNSF railroad, Dairy Queen ice cream, and energy, real estate, and auto dealer businesses of the same name.
The Friday filing suggests that the Berkshire stock purchase did not materially affect the $ 128.2 billion cash reserve as of September 30.
Berkshire should discuss its holdings in greater detail on February 22 when it publishes its annual report and Buffett’s annual letter to shareholders.
(Reporting by Jonathan Stempel in New York; editing by Chris Reese, Dan Grebler and Tom Brown)