Shareholders have rejected additional Berkshire Hathaway stake
Shareholders in non-bank lender Home Capital have rejected a proposal to increase the investment of Warren Buffett’s Berkshire Hathaway.
At a special meeting held in Toronto, an overwhelming majority of shares were voted against allowing the billionaire investor’s firm building on its 16 million shares by acquiring an additional holding at a discount price.
The proposed investment would have seen Berkshire’s stake grow from around 20% to 38% at a price of $10.30 per share, more than $3 per share lower than the current market value.
“We respect the decision our shareholders made today. This decision is a clear message that the majority of our shareholders believe that Home Capital’s improved deposit inflows and liquidity position diminish the need for additional capital. We are pleased to still have Berkshire as our largest shareholder,” said Brenda Eprile, Chair of the Board.
Buffett’s stake followed a turbulent period for the lender after depositors began withdrawing funds, forcing Home Capital to seek a credit line from Canada’s big banks.
That equity line was paid off as Berkshire Hathaway agreed a deal to provide a $2 billion credit line and acquire its stake in the firm.
At a special meeting held in Toronto, an overwhelming majority of shares were voted against allowing the billionaire investor’s firm building on its 16 million shares by acquiring an additional holding at a discount price.
The proposed investment would have seen Berkshire’s stake grow from around 20% to 38% at a price of $10.30 per share, more than $3 per share lower than the current market value.
“We respect the decision our shareholders made today. This decision is a clear message that the majority of our shareholders believe that Home Capital’s improved deposit inflows and liquidity position diminish the need for additional capital. We are pleased to still have Berkshire as our largest shareholder,” said Brenda Eprile, Chair of the Board.
Buffett’s stake followed a turbulent period for the lender after depositors began withdrawing funds, forcing Home Capital to seek a credit line from Canada’s big banks.
That equity line was paid off as Berkshire Hathaway agreed a deal to provide a $2 billion credit line and acquire its stake in the firm.
