Warren Buffett and his company Berkshire Hathaway Inc. are expected to maintain their $5 billion investment in Goldman Sachs Group Inc. until at least 2011, according Reuters. Buffett acquired preferred shares and warrants to buy common stock at $115 per share, last September, when Lehman Brothers Holdings Inc. collapsed. Common stock shares in Goldman Sachs declined to $47.44 by November, but have recovered to $143.09 as of June 18.
Goldman Sachs recently repaid $10 billion of TARP funds to the US government and expects 2009 profits and bonuses to reach a new high, according to the Guardian. Buffett’s presence at the investment bank is not felt as much as the government’s because of Buffet’s hands-off investment style. Critics questioned the famed investor’s decision at the time as the stock markets worldwide continued record sell-offs, but present market conditions and recent rallies have proven Buffet right, so far.
Goldman Sachs CEO, Lloyd Blankfein, and other executives at the investment firm have agreed not sell more than 10% their shares until October 2011 when Buffet can convert his warrants into common stock.