Investments in equity securities

9 Months Ended

Sep. 30, 2019

Investments Debt And Equity Securities [Abstract]

Investments in equity securities

Note 4. Investments in equity securities

Investments in equity securities as of September 30, 2019 and December 31, 2018 are summarized based on the primary industry of the investee in the table below (in millions).

	Cost Basis		Net Unrealized Gains		Fair Value
September 30, 2019*
Banks, insurance and finance	$	44,694	$	51,804	$	96,498
Consumer products		38,928		43,087		82,015
Commercial, industrial and other		28,585		12,953		41,538
	$	112,207	$	107,844	$	220,051

* Approximately 66% of the aggregate fair value was concentrated in five companies (American Express Company – $17.9 billion; Apple Inc. – $57.0 billion; Bank of America Corporation – $27.8 billion; The Coca-Cola Company – $21.8 billion and Wells Fargo & Company – $20.2 billion).

Notes to Consolidated Financial Statements (Continued)

Note 4. Investments in equity securities (Continued)

On April 30, 2019, Berkshire committed to invest a total of $10 billion in connection with Occidental Petroleum Corporation’s (“Occidental”) proposal to acquire Anadarko Petroleum Corporation (“Anadarko”). The Anadarko shareholders approved the acquisition by Occidental on August 8, 2019 and the acquisition and our investment in Occidental closed on August 8, 2019.

Berkshire’s investments in Occidental include newly issued Occidental Cumulative Perpetual Preferred Stock with an aggregate liquidation value of $10 billion, together with warrants to purchase up to 80 million shares of Occidental common stock at an exercise price of $62.50 per share. The preferred stock accrues dividends at 8% per annum and is redeemable at the option of Occidental commencing on the tenth anniversary of issuance at a redemption price equal to 105% of the liquidation preference plus any accumulated and unpaid dividends, or mandatorily under certain specified capital return events. Dividends on the preferred stock may be paid in cash or, at Occidental’s option, in shares of Occidental common stock. The warrants are exercisable in whole or in part until one year after the redemption of the preferred stock. Our investments in Occidental are included in the commercial, industrial and other category in the preceding table.

	Cost Basis		Net Unrealized Gains		Fair Value
December 31, 2018*
Banks, insurance and finance	$	44,332	$	38,260	$	82,592
Consumer products		38,783		22,838		61,621
Commercial, industrial and other		19,752		8,792		28,544
	$	102,867	$	69,890	$	172,757

* Approximately 68% of the aggregate fair value was concentrated in five companies (American Express Company – $14.5 billion; Apple Inc. – $40.3 billion; Bank of America Corporation – $22.6 billion; The Coca-Cola Company – $18.9 billion and Wells Fargo & Company – $20.7 billion).