Berkshire to Invest at Least $5 Billion in Goldman Sachs

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By Alistair Barr

RISMEDIA, Sept. 25, 2008-(MarketWatch)-Berkshire, the insurance focused conglomerate run by Warren Buffett, agreed late Tuesday to invest at least $5 billion in Goldman Sachs. Berkshire Hathaway also owns HomeServices of America, Inc. a Minneapolis-based real estate brokerage that operates in 19 states under 20 company names.

Berkshire, is buying $5 billion of perpetual preferred stock in the investment bank. The preferred stock has a dividend of 10% and is callable at any time at a 10% premium. Berkshire Hathaway will also get warrants to purchase $5 billion of Goldman common stock with a strike price of $115 each. Buffett can exercise these at any time over five years, Goldman said in a statement. Goldman also said it’s raising at least $2.5 billion by selling common stock in a public offering.

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