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Fri, Nov 16, 2007 - Page 10 News List

Buffett's Berkshire Hathaway buys shares in Carmax


Billionaire Warren Buffett's Berkshire Hathaway Inc has bought nearly 14 million shares of Carmax Inc, the US' largest specialty used-car retailer, according to a regulatory filing on Wednesday.

Berkshire bought the shares -- its first stake in the Richmond, Virginia-based firm -- sometime in July, August or September, according to Berkshire's quarterly summary of its US$65.8 billion portfolio of US stocks.

Carmax operates 86 used car stores in 39 US markets and is preparing to open a new store in Omaha next month about 19km west of Buffett's office. Carmax says it sold 337,021 used vehicles and 208,959 wholesale vehicles at auction last year.

Berkshire's filing with the US Securities and Exchange Commission doesn't say how much the company paid for the shares, which represent about a 6.4 percent stake in Carmax, but they were worth more than US$284 million at the end of the quarter on Sept. 30.

Berkshire again cut its holdings in two railroad companies, Norfolk Southern Corp and Union Pacific Corp, after months of buying.

Berkshire said it held 4.5 million shares of Union Pacific as of Sept. 30, down from the 7.4 million shares of the Omaha-based railroad that Berkshire held June 30. It's less than half of the 10.5 million shares of the railroad Berkshire held March 31, according to an earlier filing.

Berkshire also said it held 1.9 million shares of Norfolk Southern as of Sept. 30, less than the 3.8 million it owned as of June 30. Earlier this year, Berkshire held nearly 6.4 million shares of Norfolk Southern.

But Buffett's interest in its biggest railroad investment doesn't seem to be waning. An Oct. 5 filing showed he held 60.8 million shares of Burlington Northern Santa Fe Corp. Buffett's company controls 17.2 percent of the nation's second-largest railroad.

Berkshire also now holds 2.7 million shares of Wabco Holdings Inc, a vehicle control systems business spun off of American Standard Cos. Berkshire would have received Wabco shares as part of the spinoff because it owned American Standard shares -- 10.96 million at the end of September.

Meanwhile, Berkshire bought about 3.6 million more shares of Dow Jones & Co, publisher of the Wall Street Journal. Berkshire owned 6.3 million shares of Dow Jones, worth US$378.8 million, at the end of the quarter, after a purchase of nearly 2.8 million shares earlier this year before Rupert Murdoch sealed his deal to buy the company.

Berkshire continued adding to banking holdings during the quarter, buying 28.4 million shares of US Bancorp, the parent company of US Bank. It also bought more than 22 million shares of Wells Fargo & Co, bringing its total to 280 million shares. However, it bought fewer shares of Bank of America Corp.

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