1 Stock Warren Buffett Could Target Next With Berkshires $334 Billion Cash Pile
Summary
One way Warren Buffett, CEO and chairperson for Berkshire, could deploy some of that cash is through merger arbitrage, a short-term approach that involves buying stocks of companies trading below their acquisition price. Learn More » Despite his reputation as a long-term investor, Buffett has engaged in merger arbitrages for more than 30 years, including three notable ones within the past decade. At a recent Berkshire annual meeting, Buffett pointed out that these well-established companies generated an outsized "spread" -- the difference between the stocks trading and buyout prices -- due to regulatory risks. In September 2024, Verizon announced its intention to acquire Frontier in an all-cash deal at the aforementioned price tag of approximately $20 billion, which equates to $38.50 per share. Notably, the management teams believed the deal would take approximately 18 months to clear approval by Frontier shareholders and regulators.