Warren Buffett says his team didn’t know Microsoft was planning to buy Activision Blizzard when they bought the games stock


The well-known investor and CEO of Berkshire posted a letter on his company’s website on Thursday to clarify the situation.

He wrote that one of his two portfolio managers, Todd Combs and Ted Weschler, was responsible for buying all 14.7 million Activision Blizzard shares last quarter.

His assistant built 85% of the position in October and added the rest in November at an average cost of $77 per share, Buffett said.

Buffett directed his letter to three reporters who had reported that Berkshire bought Activision Blizzard stock for less than $67 on average, based on a Wall Street Journal article published Tuesday. The billionaire said he reported the incorrect figure to the Journal reporter, and the story was corrected later that day.

The Berkshire Hathaway boss pointed out that he and his team had no prior knowledge of the Microsoft deal when they bet on Activision Blizzard.

Buffett, who is close friends with Microsoft co-founder Bill Gates, said he would be surprised if the enterprise software titan had even approached Activision about a possible takeover as early as October.

Indeed, The Journal previously reported that Microsoft games boss Phil Spencer only contacted Activision Blizzard CEO Bobby Kotick about a potential deal after the stock price from the maker of “Call of Duty” and “World of Warcraft” fell in November a few weeks after Berkshire began buying the stock.

Activision Blizzard’s stock price rose from around $65 to $82 after Microsoft announced the proposed merger on January 18. It closed at $81 on Thursday, valuing Berkshire’s stake at $1.2 billion, less than $100 million above its cost base.

Buffett noted that Activision Blizzard shares were trading at $78 at the end of January, so any investor could have bought at a similar price to his deputy.

“His purchase was in no way a bargain for him or Berkshire,” Buffett said.

The 91-year-old, who cares deeply about his reputation and his legacy, wrote that he was posting the letter on Berkshire’s homepage to ‘dispel any misinformation’ and to ‘have the correct record after I’m not here”.

Buffett’s business partner Charlie Munger was asked about the Activision Blizzard bet at the Daily Journal’s annual meeting this week. He declined to comment on the investment, but called CEO Bobby Kotick “one of the smartest business leaders I know.”


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