Berkshire Hathaway (BRK-B, BRK-A) is acquiring Occidental Petroleum’s (OXY) chemical division, OxyChem, for $9.7 billion, in what could mark the last major deal involving Warren Buffett before he hands over the CEO role to Vice Chair Greg Abel in January. Buffett will remain chairman and continue influencing how the conglomerate deploys its massive cash reserves, which now exceed $344 billion.
Notably, Buffett’s name was absent from Berkshire’s materials announcing the transaction, signaling a possible generational shift in dealmaking authority. Over the past several years, Berkshire’s cash pile has grown as Buffett struggled to find acquisitions at attractive valuations, following the $11.6 billion purchase of Alleghany Insurance in 2022. Rising prices for large deals, fueled by increased hedge fund activity, have made finding compelling targets more challenging.
OxyChem produces industrial chemicals such as chlorine for water treatment, vinyl chloride for plastics, and calcium chloride for road de-icing. The business is expected to complement Berkshire’s existing chemical holdings, including Lubrizol, which Buffett acquired in 2011 for $9 billion. “Berkshire is acquiring a robust portfolio of operating assets, supported by an accomplished team,” Abel said in a statement. “We look forward to welcoming OxyChem as an operating subsidiary within Berkshire.”
For Occidental, the sale of OxyChem will help accelerate debt reduction. OxyChem generated $213 million in pretax earnings in the second quarter, down from nearly $300 million a year ago. Occidental has been divesting assets in the Permian Basin, raising $950 million to pay down debt, and has sold roughly $4 billion in assets since its CrownRock acquisition in December 2023 to reduce $7.5 billion in debt. Proceeds from the Berkshire deal—estimated at $6.5 billion—will help Occidental bring its principal debt below the $15 billion target set after CrownRock.
Berkshire already holds a significant stake in Occidental, including more than 28% of its stock, warrants to purchase roughly 84 million shares at $59.586 each, and about $8.5 billion in preferred shares purchased in 2019 to help finance Occidental’s acquisition of Anadarko. Buffett has consistently stated he does not plan to sell the Occidental stake and has occasionally added to his holdings.
Berkshire’s sprawling portfolio spans insurers like Geico, the BNSF railroad, utilities, and consumer brands such as Dairy Queen and See’s Candy. It also holds more than $250 billion in public equities, including large positions in Apple, Coca-Cola, Bank of America, and American Express. The OxyChem acquisition is expected to close in the fourth quarter of 2025, marking another significant chapter in Buffett’s six-decade tenure at the helm of the conglomerate.
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