Berkshire Hathaway Revealed as Mystery Investor in Chubb with $6.7 Billion Stake
Warren Buffett’s Berkshire Hathaway has always been known for its strategic investments and ability to generate significant returns for its shareholders. However, in recent quarters, the company has been quietly investing millions of dollars into an anonymous company, leaving many investors and analysts scratching their heads. But now, thanks to a new filing with the U.S. Securities and Exchange Commission, the mystery has been solved.
In a Wednesday filing, Berkshire revealed that it has purchased 26 million shares of insurance company Chubb, totaling an estimated $6.7 billion stake. Chubb, a Swiss insurance giant, was acquired by Ace Limited for $29.5 billion in 2016, and the two companies were combined under the Chubb name.
Chubb had a stellar Q1 in 2024, with net income up 13.3% to $2.14 billion and core operating income up 20.3% to $2.22 billion. Chubb CEO Evan G. Greenberg attributed the strong performance to double-digit premium revenue growth across the globe, particularly in the commercial and consumer P&C and Asia life businesses.
This investment in Chubb marks Berkshire’s latest foray into the insurance industry, adding to its portfolio of insurance companies including Geico, National Indemnity, and Gen Re. The decision to invest in Chubb was kept under wraps for two quarters, as Berkshire was granted special permission to do so, a practice the company has employed in the past with investments in companies like Chevron and Verizon.
At Berkshire Hathaway’s annual shareholder meeting earlier this month, Warren Buffett revealed that the company had sold its entire stake in Paramount at a loss. Despite this setback, Buffett’s seal of approval on the Chubb investment has already had a positive impact, with Chubb’s stock price rising over 4.3% in a 24-hour period and over 32% in a one-year period as of Thursday morning.
Overall, Berkshire Hathaway’s investment in Chubb demonstrates the company’s continued confidence in the insurance industry and its ability to identify lucrative investment opportunities. As always, Warren Buffett’s investment decisions continue to captivate investors and analysts alike, showcasing his unparalleled expertise in the world of finance.