Buffett Passes Over CN Rail for Norfolk Southern and Union Pacific

Warren Buffet may not be as interested in Canadian rails as previously thought.

Last month, Mr. Buffet’s Berkshire Hathaway Inc. said it had increased its stake in Texas-based Burlington Northern Santa Fe Corp. (BNI) to 11% and taken a smaller piece of two other previously undisclosed railways. At the time, analysts speculated that Virginia-based Norfolk Southern Corp. (NSC) and Canadian National Railway Co. (CNI) would likely be the other two railroad’s because they fit Mr. Buffet’s penchant for high-quality, cheap companies, rather than fixer-uppers.

Turns out the analysts were half right.

Berkshire revealed late Tuesday in regulatory filings that, as of March 31, it owned 6.4 million shares of Norfolk Southern valued at US$322-million, and 10.5 million shares of Nebraska’s Union Pacific Corp. (UNP) valued at $1.07-billion.

No matter, shares in Canada’s largest railway, which boasts Bill Gates as one of its high-profile investors, have rallied since the Berkshire buy, increasing their unit value by 16% since April 5.

Comments

[wghanna2:]

Where do you find the information that Bill Gates is a shareholder. I have not been able to find it. If he is, how many shares does he own? Good article but need assurance that Bill Gates is an owner.

Bill Hanna

2007 May 18 01:31 PM