Warren Buffett’s Berkshire Hathaway has sold off more of its stake in the world’s biggest EV maker, BYD of China, taking the holding below the disclosure level on the Hong Kong Stock Exchange.
Berkshire revealed this week that it cut its holding in BYD H-shares on July 16, dropping its stake from 5.06% to 4.94%, according to a Hong Kong Stock Exchange filing.
The company reduced its holdings in BYD by 1,395,500 shares at an average price of HK$246.96 in its latest move, cashing out HK$344 million (US$44 million).
Under Hong Kong Stock Exchange rules, when an organization’s shareholding in a Hong Kong-listed company drops below 5%, it is no longer required to disclose its holdings (similar to Australian corporate rules).
This means that the July 16 disclosure is likely the last time Berkshire discloses its position in BYD on the Hong Kong Stock Exchange.
Berkshire Hathaway Energy first acquired its stake in BYD on September 29, 2008, revealing it had spent US$230 million to buy 225 million shares of BYD at a price of HK$8 per share.
Berkshire's holdings in BYD remained unchanged until August 24, 2022, when it sold 1.33 million BYD Hong Kong shares, reducing the stake from 20.04% to 19.92%.
The 20.04% stake was worth more than US$10 billion—a significant gain from the original US$230 million investment.
That was the first reduction since Buffett bought BYD shares, but the sales have become more frequent, especially after the death of Charlie Munger—Buffett’s longtime friend and Berkshire Vice Chair, who initiated the company's investment in BYD.
Munger died at the end of last November at the age of 99, just before his 100th birthday on New Year’s Day this year.
If Berkshire still holds a 4.9% stake in BYD, it is worth a considerable US$4.9 billion (BYD’s market value is just under US$100 billion), still representing a huge profit on the original cost.
This is not the first China-related stock Berkshire has bought and then sold—it acquired a stake in global chip giant TMSC of Taiwan in late 2022 but sold it all, around US$4 billion worth, after China escalated tensions with Taiwan late that year and into early 2023.
Meanwhile, Berkshire raised eyebrows last week with another unexpected sale—around 1.33 million shares in Bank of America, one of its top three shareholdings. The amount raised more than US$1.4 billion and came with no explanation in the filing with the US Securities and Exchange Commission.
Berkshire still holds around US$43 billion worth of Bank of America shares.
