Buffett Back in Deal Mode
Warren Buffett’s Berkshire Hathaway (BRK.A, BRK.B) is reportedly on the verge of sealing a $10 billion acquisition of OxyChem, the petrochemical division of Occidental Petroleum (OXY).
If finalized, the transaction would be Berkshire’s biggest deal since its $11.6 billion purchase of insurer Alleghany in 2022. It would also mark Buffett’s second major foray into chemicals, following the Lubrizol acquisition in 2011.
The Financial Times and Wall Street Journal, citing sources familiar with the matter, said the deal could close within days.
Why It Matters for Investors
Berkshire already holds a major stake in Occidental, making this deal a deeper bet on energy and materials. For Occidental, weighed down by debt, selling OxyChem helps raise capital while sharpening its focus on core oil and gas operations.
The timing is just as critical for Berkshire:
- The conglomerate is sitting on a record $344 billion in cash and equivalents as of June.
- Lofty valuations have made it harder for Buffett to strike new deals, often leaving Berkshire to buy back its own stock.
- With Buffett set to retire at year-end and Greg Abel preparing to step in as CEO, this acquisition could be one of the last major Buffett-led deals.
The Market Reaction
Occidental shares, down 4% year-to-date, were little changed on the reports. Berkshire stock slipped about 1% in recent trading but remains up nearly 10% in 2025.
While investors wait for confirmation, the deal underscores Buffett’s strategy of deploying capital into sectors where scale and pricing power matter.
WSA Take
This isn’t just another Berkshire deal — it’s a statement. Buffett has long preferred buying businesses that generate consistent cash, and OxyChem fits that bill. At the same time, it signals Berkshire’s willingness to commit big money in industrials, a sector that could see stronger margins as reshoring and energy realignment accelerate.
For investors, the move highlights two realities:
- Buffett is still hunting elephants — even in his final stretch.
- Berkshire’s mountain of cash is a weapon, not a burden, when the right opportunity comes along.
If you missed our recent piece on Amazon’s $5 grocery brand launch, it shows that whether it’s household essentials or billion-dollar chemicals, the investment story always comes back to scale and resilience. Visit the Wall Street Access homepage for more deep dives.
Disclaimer
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