Warren Buffet buys £7bn IBM stake
One of the world's most closely watched investors has pumped a lot of money into IBM. What does he know that we don't?
If you've got some pennies going spare, you might want to invest in IBM. Warren Buffet has just revealed that he has done exactly that, and to be honest, if it's good enough for the world's third wealthiest man (and one of the wisest investors), it's good enough for us.
The billionaire's company Berkshire Hathaway started buying shares in the company back in March, and in total has spent around $10bn (£6.7bn), reports the BBC. What can we say, the man doesn't do things by halves.
'Breakfast' Buffet (as we want to call him) hasn't splashed the cash with tech companies before, but was impressed how IBM intended to attract IT firms internationally. "If you're in some company around the world and you're developing your IT department you're probably going to feel more comfortable with IBM than with many companies," he told CNBC.
"It is a big deal for a big company to change auditors, change law firms, or change IT support," he said. "There's a fair amount of presumption in many places that if you're with IBM, you stay with them."
He was also influenced by reading the company's 2010 annual report and speaking to tech professionals. He has, however, ruled out buying any stock in Microsoft due to his friendship with Bill Gates. Either that or he's not a fan of Windows Phone.
Buffet didn't tell IBM's chief executive about the investment. He now owns 5.4 per cent of IBM; the US bank, State Street, owns 5.5 per cent. That's right, Buffet owns nearly as much as a US bank. No wonder he was ranked the third wealthiest person in the world this year. (He was first in 2008.)
Buffet is a noted philanthropist, and is notoriously frugal despite his personal fortune being valued at $47bn (£30bn).
Image credit: Forbes.