by Kay Murchie , Financemarkets.co.uk, 6 May 2008
Berkshire Hathaway, the investment group controlled by US billionaire Warren Buffett, is rumoured to be a possible buyer of the insurance arm of Royal Bank of Scotland (RBS).
Speaking at the annual meeting of his Berkshire Hathaway investment group over the weekend, Mr Buffett said that his business was close to buying a medium-sized British company and would look at the possible sale of RBS’s insurance unit.
Last month, RBS, the UK’s second largest bank, confirmed it was planning a rights issue to improve its financial position.
The bank announced it was considering selling assets to raise billions of pounds which includes the possible sales of its insurance arm which owns Churchill and Direct Line.
If Mr Buffett tries to buy the business, he would be competing with other bidders. Italian insurer, Generali SpA, expressed an interest last week.
At the annual meeting, Mr Buffett also warned that housing market weakness isn’t over yet and predicted more losses for banks, while noting that the US is in a recession.
Mr Buffett is often referred to as the ‘Oracle of Omaha’. In April 2007, he was ranked by Forbes as the third-richest person in the world. Last year, he was listed among Time’s 100 Most Influential People in The World.Visit Share Investor Blog