SOURCE:
BLOOMBERG NEWSURL:
http://www.bloomberg.com/news/articles/2016-07-01/buffett-applies-to-fed-to-expand-wells-fargo-holding-beyond-10by: Noah Buhayar, Katherine Chiglinsky
Warren Buffett’s Berkshire Hathaway Inc. applied to the Federal Reserve for approval to expand its stake in Wells Fargo & Co. after reaching the 10 percent threshold that requires regulatory review.
“Berkshire is seeking permission to retain its current ownership position in Wells Fargo and to acquire additional shares of common stock of Wells Fargo for investment purposes,” Buffett’s Omaha, Nebraska-based company said in an application to the Fed. “Berkshire does not have any specific transaction or dollar value in mind with respect to any such potential purchases.”
U.S. regulations have long limited ties between non-financial companies and banks. Investors typically have to tell the Fed and the public before acquiring 10 percent ownership in a bank, though that notice can be delayed if the threshold is reached because of share repurchases.
Berkshire said in the application that it hasn’t bought shares in Wells Fargo since Oct. 21. Buffett’s company learned that it crossed the limit in March, when the bank updated its share count to reflect buybacks. Berkshire told the U.S. Securities and Exchange Commission that month that the stake had reached 10 percent.
Buffett’s company has no plans to merge Wells Fargo with another firm or to make any significant changes to its strategy or corporate structure, according to the application, which is dated June 14. Nor is Berkshire contemplating any changes to the San Francisco-based bank’s board, the company said.
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