Warren Buffett Plans to Gradually Raise Stakes in Japan Trading Houses

Berkshire Hathaway is looking to increase its ownership in Japan’s five largest trading companies “over time,” Warren Buffett wrote in an annual letter to shareholders, likely boosting their stock prices in Tokyo.

The Omaha, Nebraska-based conglomerate originally agreed to keep its holdings in the companies below 10%. But the trading houses agreed to ease the ownership cap “at a moderate pace” as Berkshire approaches the cap, according to the letter dated Saturday.

The five companies, including Mitsubishi Corp., Mitsui & Co., Itochu Corp., Sumitomo Corp. and Marubeni Corp. have benefited from Buffett’s long-term interest. But it has struggled in recent months, along with the broader Japanese stock market.

Buffett’s comments will be in focus for traders when the Japanese market returns to trading on Tuesday after a public holiday. Tokyo stocks have lagged global peers as a stronger yen weighed on exporters. The Topix is ​​down about 1.7% this year while the MSCI Asia Pacific index is up about 4.6%.

Investors have been speculating about Buffett’s next move since Berkshire Hathaway sold its largest yen-denominated bond since 2019 in October.

Tokyo-based Mitsubishi Corp said Sunday it is in discussions with Berkshire about collaborating on individual projects, including through joint investments. The company said it will continue efforts to improve corporate value and boost its stock price in the medium to long term.