Buffett Watch

Warren Buffett's Berkshire Hathaway Adds to Burlington Northern Options


Warren Buffett's Berkshire Hathaway holding company has bought some more call options on Burlington Northern Santa Fe, but not nearly as many as revealed in another filing earlier this month.

In a filing with the SEC about two hours ago, Berkshire says that last Tuesday it acquired options giving it the right to buy 392,378 shares of Burlington Northern stock for $40/share on October 3.  (It can extend that date to November 2 by paying a yet to be determined additional premium.)  The price of the options: $39.10 each.  If exercised, that would put the total price at $79.10.  On Tuesday, the stock hit a low of $79.39 before closing at $83.16.  Current price:

Compare those 392-thousand options to the 7.5 million Berkshire bought a few weeks ago. If all of them are exercised, Buffett's stake would top 17%.  Yesterday, it was reported that Berkshire has been cleared by Federal antitrust regulators to increase its stake, and the railroad says it's been told by Berkshire that it might try to raise its stake above 25%.

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