News article

Buffett to invest in Goldman Sachs

Buffett to invest in Goldman Sachs
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Berkshire Hathaway, the investment company of super-investor Warren Buffett, is to purchase a $5 billion (£2.6 billion) in Goldman Sachs.

The deal consists of preferred stock in a private placement that will pay a dividend often per cent. It also includes warrants allowing Berkshire Hathaway to buy a further $5 billion of common stock, reports the Financial Times.

Goldman chief executive Lloyd Blankfein commented: "We are pleased that, given our longstanding relationship, Warren Buffett, arguably the world’s most admired and successful investor, has decided to make such a significant investment in Goldman Sachs."

Mr Buffet, meanwhile, described Goldman Sachs as "an exceptional institution" with "an unrivalled global franchise".

News.com.au reported that bank stocks have risen on the news of the Berkshire Hathaway investment deal.

Goldman will raise a total of $7.5 billion from the Mr Buffett and other investors, strengthening its position as it becomes a bank holding company regulated by the Federal Reserve.

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