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Buffett's utility bet not a hedge against a downturn, Berkshire Hathaway shareholder says

  • Warren Buffett's decision to buy Oncor Electric Delivery is a "great deal" for Berkshire Hathaway, shareholder Jeff Matthews said.
  • Berkshire Hathaway Energy, a unit of Berkshire Hathaway, said on Friday it agreed to buy reorganized Energy Future Holdings, Dallas-based Oncor's bankrupt parent, for $9 billion in cash.
  • Matthews believes it was "an opportunity that came along" rather than a hedge against a possible downturn in the market.

Warren Buffett's decision to buy Oncor Electric Delivery is a "great deal" for Berkshire Hathaway, shareholder Jeff Matthews told CNBC on Friday.

Berkshire Hathaway Energy, a unit of Berkshire Hathaway, said on Friday it agreed to buy reorganized Energy Future Holdings, Dallas-based Oncor's bankrupt parent, for $9 billion in cash.

Matthews said he believes it was "an opportunity that came along" rather than a hedge against a possible downturn in the market. Utilities generally hold up better in that environment.

"Buffett does not time the market. He looks for deals and when the price is right, he will go at it," said Matthews, a general partner at Ram Partners and author of "Secrets in Plain Sight: Business and Investing Secrets of Warren Buffett."

If the all-cash purchase wins approval from federal and state regulators and a bankruptcy judge, Berkshire Hathaway Energy will assume control of one of the largest U.S. electricity transmission companies.

However, on Friday afternoon, Reuters reported that Elliot Management is exploring a rival bid for Oncor. Elliott is a major creditor of Energy Future Holdings.

— Reuters contributed to this report.