Berkshire Hathaway issues another $1.9 billion Japanese yen-denominated bond to increase investment in Japan
Berkshire Hathaway issued a 1.9 billion US dollar yen-denominated bond to further increase its investment in the Japanese market. This is the company's largest yen bond issuance in five years, with the funds to be used for general corporate purposes. Analysts believe that this move lays the foundation for increasing Japanese assets, and Buffett's optimistic attitude has attracted other foreign investors, driving the Nikkei index higher
Reuters, October 10 - Warren Buffett's Berkshire Hathaway Inc. (BRKa.N) raised 281.8 billion Japanese yen (1.9 billion U.S. dollars) through the issuance of yen-denominated bonds, laying the foundation for increasing its holdings of Japanese assets, analysts said.
A document reviewed by Reuters on Thursday showed that this transaction is the largest yen bond issuance by the company in five years.
Over the past four years, Berkshire Hathaway has acquired stakes in Japan's five major trading companies. This global yen bond issuance marks Buffett's deepening connection with the Japanese capital market.
According to the filing with the U.S. Securities and Exchange Commission (SEC), the funds raised from this transaction will be used for general corporate purposes. The company did not disclose the size of the transaction in the filing.
Berkshire first announced in 2020 that it would purchase shares of Japanese trading companies, intending to hold them for the long term and increase its stake to a maximum of 9.9%. Since then, the company has increased its stakes in the five major Japanese trading companies to around 9%, according to its February annual report.
Berkshire issued 263.3 billion yen in bonds in April.
"The scale of yen bond issuance by Berkshire this year is the highest since the company started issuing yen bonds, indicating their expectations for the rise in the Japanese stock market," said Takehiko Masuzawa, trading director at Huiritsu Securities Japan.
"The market is watching which type of stocks they will target next. Investors believe that value stocks with higher dividends, such as banks and insurers, are the most likely targets."
Buffett's optimistic view of Japan has helped attract other foreign investors, with the benchmark Nikkei index (.N225) rising 17.7% year-to-date and hitting record highs.
According to the issuance document, Berkshire issued bonds with maturities of three, five, seven, 10, 20, 28, and 30 years in the latest transaction. The three-year bonds raised the most, totaling 155.4 billion yen. The five-year bonds raised 58 billion yen. Information from the book-building process showed that longer-term bonds were added during the transaction and the proposed 15-year bonds were dropped
