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Berkshire’s New Acquisitions; Very Interesting! September 3, 2009

Posted by shaferfinancial in Finance.
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Berkshire announced  three new moves.  The first is a purchase of Keonig and Strey, a Chicago based real estate brokerage firm.  It brokered $2.6B in real estate during 2008 and is especially strong in the luxury home market.

It also purchased manufacture housing company, Cavalier Homes.

The most recent move is a joint venture with Leucadia National.  It was paid $40M for the option to sell to the joint venture the mortgage  servicing business of Capmark, a lender going into bankruptcy.  The $490M commitment to buy real estate assets from the failing business could placate the FDIC reserve requirements.  More details will come soon.

Berkshire’s further move into the real estate and housing business indicates Buffett’s belief in a full real estate recovery.  Further, as a one of the last cash rich business it seems to further his belief that the time to buy is when “blood in running in the street.”  Further solidifying my belief that Berkshire is positioning itself very well for the recovery.

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