Buffett bought 3 million preferred shares of Dow for $3 billion in April 2009, helping Dow finance its acquisition of chemical company Rohm & Haas, while Kuwait Investment Authority bought 1 million preferred shares of Dow for $1 billion.
The conversion of these shares, which had an annual dividend of 8.5 percent, into common equity was contingent on Dow's shares trading above $53.72 per share for any 20 trading days in a 30-day window.
Up to Thursday's close of $58.35, Dow's shares had risen nearly 10 percent in the past month.
The conversion of each preferred share into 24.201 shares of Dow common stock, will give Buffett about 6 percent of the company and Kuwait Investment Authority about 2 percent.
Dow has paid Buffett $255 million in dividends every year, helping him make about $1.8 billion since 2009. Kuwait Investment Authority netted nearly $600 million in the same period.