Sirius XM Holdings (SIRI) stock jumped as much as 12% on Wednesday after Warren Buffett’s Berkshire Hathaway (BRK-A, BRK-B) revealed a new stake in the satellite and online radio company.
According to Berkshire’s 13F report, which discloses its holdings, the company purchased nearly 9.7 million shares with a market value of about $43.8 million in its September quarter.
Shares of Sirius have struggled so far this year, down about 10% compared to the S&P 500’s (^GSPC) 17% gain over that same time period.
The company reported a beat on earnings in its fiscal third quarter results, but missed revenue expectations. Total revenue declined 0.4% compared to the year-ago period, dragged down by a 0.3% yearly dip in subscriber revenue.
Advertising revenue, however, gained 0.7% year over year to $460 million — bucking recent industry trends amid a shaky macroeconomic environment.
In September, Liberty Media announced a proposal regarding a potential transaction that would combine Liberty SiriusXM Group (LSXM) with SiriusXM to form a new, consolidated public company.
At Liberty’s investor day earlier this month, Jennifer Witz, CEO and president of SiriusXM, said a special committee of independent directors is currently reviewing the proposal, adding: “What I want to emphasize is that regardless of the outcome of Liberty’s proposal and any transaction hypotheticals, I am confident we can quickly deliver to our communicated long-term leverage target if need be.”
The update comes as Buffett, often referred to as the “Oracle of Omaha,” sold off his holdings in other companies, including General Motors (GM), Johnson & Johnson (JNJ), Procter and Gamble (PG), Mondelez (MZ), Celanese (CE), UPS (UPS), and Activision Blizzard, which completed its merger with Microsoft in October.
He also trimmed his stake in Amazon (AMZN) by about 5% and his stake in Chevron (CVX) by more than 10%.
In addition to Sirius, the billionaire also made an investment in the publicly traded holding company that owns the Atlanta Braves Major League Baseball club and The Battery Atlanta.
He purchased 223.6 million shares worth nearly $8 million, according to the filing.
Atlanta Braves Holdings (BATRA), which was spun off from Liberty Media in July, reported third quarter profit of $272 million, up 11% year over year amid higher in-game attendance.
Buffett’s long history with media and entertainment
Buffett’s Berkshire Hathaway, which owns over 65 companies across a variety of sectors, has a lengthy history with media and entertainment businesses.
After serving as a financial adviser to help broker a deal between broadcaster ABC and Capital Cities Communications, Berkshire agreed to purchase an 18% stake in the new conglomerate for $517 million to help finance the merger. At the time, this deal was the largest non-oil deal in modern American business history.
“I like media companies as a business,” Buffett told the New York Times at the time. “I’m interested in the product. I always thought the media had a bright future, but it took Wall Street a long time to appreciate that.”
In 1995, Disney announced a $19 billion merger of equals with Capital Cities/ABC — another milestone corporate takeover and a key step in cementing Disney’s all-encompassing entertainment legacy.
The 93-year-old billionaire has also owned 30 daily newspapers over the years, including his hometown Omaha World-Herald, along with other holdings through Berkshire’s print publishing unit, BH Media Group.
The division was eventually sold to Lee Enterprises for $140 million in 2020 after Buffett admitted during a 2019 interview with Yahoo Finance that the newspaper business was “toast.”
“The world was changed hugely, and it did it gradually,” Buffett said. “[The business] went from monopoly to franchise to competitive to … toast.”
Despite the industry’s challenges, however, Buffett has always been a lifelong lover of newspapers.
The Washington Post was one of Berkshire’s primary holdings until it was sold off to Amazon’s Jeff Bezos for $250 million in 2014.
Alexandra Canal is a Senior Reporter at Yahoo Finance. Follow her on Twitter @allie_canal, LinkedIn, and email her at firstname.lastname@example.org.
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