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Warren Buffett Lunch Winner: I Won't Profit From Stock Tip Windfall

Published: Monday, 6 Jul 2009 | 8:43 AM ET

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By: Alex Crippen
Executive Producer

Lunch with Warren
The Chinese investor who donated $2.1 million dollars for a late-June lunch with Warren Buffett says his "tip from a friend" was not designed to influence the stock price of a relatively little known retailer in China.

The New York Times relates how shares of WuMart soared about 25 percent in the days after after Zhao Danyang said he planned to tell Buffett about the company during their June 24 steak lunch in New York City. As a result, Zhao's holdings in WuMart increased in value by about $16 million.

David Barboza, writing from Shanghai for the Times, says Chinese bloggers are "feasting" on Zhao, suggesting he "cleverly turned what looked like an expensive $2.1 million lunch date into a short-term gain of $14 million."

But a "clearly annoyed" Zhao tells the Times, "I didn't want to influence the market. It was just a tip from a friend."

Zhao says he just gave Buffett a few copies of WuMart's annual report. "I don't think Buffett will invest in this company. Every day, he can look at thousands of companies."

And, says Zhao, as a buy-and-hold Buffett disciple, he has no plans to sell his shares to lock in a short-term windfall.

In Hong Kong trading, WuMart shares are well off the high they reached just after Zhao's lunch, but are still up about 3 percent from earlier in June. They've soared over 60 percent year-to-date.

Current Berkshire stock prices:

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