Ajit Jain sells more than half of his Berkshire Hathaway stake | Wilnesh News

Warren Buffett’s insurance chief and CEO Ajit Jain sells more than half his stake Berkshire HathawayA new regulatory filing shows.

The 73-year-old insurance vice chairman sold 200 shares of Berkshire Class A stock on Monday at an average price of $695,418 per share, for about $139 million. That leaves him with just 61 shares, while the family trust he and his spouse established for the benefit of future generations holds 55 shares and his nonprofit Jain Foundation holds 50 shares. Monday’s sale represents 55% of his total stake in Berkshire Hathaway.

The move marks the biggest drop in Jain’s stake since joining Berkshire Hathaway in 1986. As of the end of August, the group was trading at over $700,000, with a market capitalization of $1 trillion.

“This seems to be a signal that Ajit believes Berkshire Hathaway is fully valued,” said David Kass, professor of finance at the University of Maryland’s Robert H. Smith School of Business. reflect.”

This is also consistent with Berkshire’s recent sharp slowdown in share repurchase activity. Omaha-based Berkshire Hathaway repurchased only $345 million worth of its own stock in the second quarter, significantly less than the $2 billion in each of the previous two quarters.

“I think that, at best, it just shows that the stock is not cheap,” said Bill Stone, chief information officer of Glenview Trust and a Berkshire shareholder. “The book value is over 1.6 times, which is probably close to Buffett’s estimate of intrinsic value. Conservative estimate. I don’t expect Berkshire to buy back much stock at this level.”

The India-born Jain played a crucial role in Berkshire’s unparalleled success. He has boosted the reinsurance industry and most recently led the turnaround of Geico, Berkshire’s crown jewel auto insurance business. In 2018, Jain was named vice chairman of insurance operations and appointed to Berkshire’s board of directors.

Buffett wrote in his 2017 annual letter: “Ajit has created tens of billions of dollars in value for Berkshire shareholders. If there is another Ajit and you can trade me for him, don’t hesitate. Make a deal!

Before it was officially announced that Greg Abel, Berkshire’s vice chairman of non-insurance operations, would eventually succeed the 94-year-old Buffett, there were rumors that Jain would one day lead the group. Buffett recently clarified that Jain “never wanted to run Berkshire” and that there was no competition between the two.