Buffett Watch

American Express Shareholder Vote Sparks Buffett Speculation

Speculation, (underline speculation), that Warren Buffett could be looking to buy American Express, has been sparked by the company's move this week to make it easier for shareholders to approve a merger or sale.  

Instead of a two-thirds vote, only a majority of shareholders would be needed to clear a deal, under a proposal passed at the company's annual meeting.

Buffett's Berkshire Hathaway is already the biggest investor in American Express with almost 152 million shares as of the end of the year, worth about $7.3 billion at today's close of $48.02.  Current price:

Bloomberg's story on the new lower threshold quotes Berman Asset Management's Philip Berman as saying, "American Express may be considering eventually to become a private enterprise and become delisted, or become part of Warren Buffett's empire."  Bloomberg also notes American Express CEO Kenneth Chenault's comment that he has regular meetings with Buffett.

A company spokesman tells Bloomberg there are "no current plans to effect any of these actions."

The New York Times blog Deal Book picked up the story today, pointing out that with a 'marked-down' market value of $56 billion (the stock has dropped 20 percent over the last six months), American Express would mesh nicely with Buffett's revelation at last year's annual meeting that he's looking for a big deal, as much as $60 billion big.  But it also reminds us that "Mr. Buffett has repeatedly tried to blunt speculation that he might ride to the rescue of an ailing bank or Wall Street firm."

Warren Buffett Watch has its own reminder.  It's a Buffett quote that has appeared in many of these posts:   "All the speculation is just speculation."

While it is not among our nominees for Best Buffett Bite of all-time, it's a good one to keep in mind.

Berkshire price:

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