Daddy Warbucks Screams “I’ve Got One More In Me” With Astronomical $10 Billion Oxy Fleece

Warren Buffett might finally be pulling out the checkbook again, and this time it’s not to add another railroad to his train set. Word on the street is Berkshire’s about to drop around $10 billion on Occidental Petroleum’s petrochemicals unit, OxyChem, which would be his biggest move since snagging Alleghany (insurance company, obviously) back in 2022. Yes, the man sitting on almost $350 billion in cash at dang near 100 is allegedly about to prove he does, in fact, know what money is for.

Occidental’s playing the role of desperate seller here, trying to chip away at a $24 billion debt load that’s starting to feel insurmountable compared to the P&L. OxyChem raked in nearly $5 billion in revenue over the last year, but CEO Vicki Hollub is apparently willing to toss it to Warren if it means keeping Moody’s from knocking on the door.

Buffett, of course, is already neck-deep in Oxy (the company kind). Berkshire owns nearly a third of the stock, thanks to him going all-in during the pandemic when it was trading for pennies on the dollar. Oh and even before that, let’s not forget he first helped bankroll Occidental’s $55 billion Anadarko purchase in 2019 with a “small loan of $10 billion dollars.” Since then, he’s been quietly shoveling up shares after literally reading a transcript and deciding “yep, I like it.” Imagine trusting your earnings calls that much.

(Source: CNBC)

Aside from being addicted to Oxy, why do this now? Well, Buffett’s basically on his farewell tour… he’s set to hand the CEO reins to Greg Abel at the end of 2025. Abel’s a dyed-in-the-wool energy guy, so handing him a petrochem division is like giving a master chef a brand-new kitchen… he actually knows what to do with the tools, and this one just happens to come with a money-printing oven.

Strangely enough, Occidental’s stock slipped almost 2% after the headlines, because investors weren’t exactly giddy about Oxy dumping one of its few steady cash generating businesses just to chip away at that $24 billion debt tab. The move came off more like pawning grandma’s wedding ring to cover rent than a savvy deleveraging play. But that’s usually the exact kind of reaction Buffett loves. Everybody else panics, Grandpa swoops in, and 10 years later we all pretend it was obvious.

So the Oracle of Omaha may be 95, but if this deal goes through, it looks like he’s still got one more trick up his sleeve before the farewell tour wraps. A guy who’s been flipping through SEC filings like bedtime stories for seven decades is still out here swinging billion-dollar deals. Let’s take a moment to appreciate the legend before he finally hangs them up for good… because who knows, this might be the last Warren Buffett headline I ever get to write.

At the time of publishing this article, Stocks.News doesn’t hold positions in companies mentioned in the article.