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Berkshire Hathaway shares hit all-time high despite Buffett's energy deal unraveling

Key Points
  • Berkshire's $9 billion all-cash deal for power transmission company Oncor terminated after Sempra Energy emerged as the victor.
  • Buffett's conglomerate had been battling for Oncor with the hedge fund Elliott Management.
  • Berkshire has a nearly $100 billion war chest of cash to make deals.
Warren Buffett
David A. Grogan | CNBC

Even when losing, Berkshire Hathaway's Warren Buffett is secretly winning.

Shares of the billionaire's conglomerate rose to a new high on Tuesday after S&P Global Ratings said the company is no longer at risk of a credit rating downgrade. Berkshire A shares hit $270,960, and B shares rose to $180.61, both all-time highs, according to FactSet data.

S&P affirmed Berkshire's AA rating and a stable outlook. Berkshire had been on review since July, after bidding $9 billion in cash for the Texas power transmission operation of Energy Future Holdings. But in a bizarre (for Buffett, at least) three-way bidding war for the company, called Oncor, Sempra Energy emerged the victor over the weekend, with a $9.45 billion offer.

Why billionaire investors like Warren Buffett are chasing after this energy investment

Energy Future Holdings terminated the Berkshire agreement on Monday. Oncor would have become part of Berkshire Hathaway Energy. Buffett had been battling with fellow billionaire Paul Singer, whose fund Elliott Management was trying to cobble together a $9.3 billion deal until Sempra emerged.

In a statement Monday, Greg Abel, the chairman of the Berkshire unit, said, "We are disappointed our agreement to acquire Oncor has been terminated. We are extremely grateful for the strong support and extraordinary backing from all of the stakeholders in Texas."

Berkshire had negotiated a $270 million deal breakup fee, but it isn't entitled to receive it because the court didn't approve the merger agreement.

Buffett's company has a giant nearly $100 billion war chest of cash for acquisitions but finding investments hasn't been easy lately. Berkshire-backed Kraft Heinz backed down from a $143 billion offer for Unilever earlier this year. On the other hand Berkshire has put a significant stake of Apple shares on its books, about 2.5 percent of the company, according to FactSet.

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