CINCINNATI (CINCINNATI ENQUIRER) - Warren Buffett’s Berkshire Hathaway has acquired a 2.3 percent stake in Cincinnati-based Kroger, government disclosures say.
Our media partners at the Cincinnati Enquirer say word of the legendary investor’s $500 million purchase in the nation’s second-largest grocer sent the company’s stock soaring in after-market trading late Friday. The New York Stock Exchange is closed for Presidents’ Day, but Kroger shares are up nearly 6% to $29.88 in extended-hours trading.
With a net worth of more than $80 billion, Buffett is listed as the world's third-wealthiest man behind Amazon CEO Jeff Bezos and Microsoft founder Bill Gates, according to Forbes. Buffett's conservative buy-and-hold investing style is credited for popularizing value investing.
Buffett's investing style, unlike activist hedge funds that have targeted Cincinnati peers such as Procter & Gamble and Macy's, will likely be interpreted as a vote of confidence in Kroger management's strategy and stock outlook.
Berkshire Hathaway's 18.9 million shares are enough to make it one of Kroger's 10-largest investors.
Kroger’s stock has taken a hit in recent years after Amazon jumped into the grocery business when it acquired Whole Foods in mid-2017. Since then, the Downtown-based retailer has ramped up curbside pickup and home delivery options to woo customers demanding more convenience.