Billionaires Warren Buffet and George Soros are putting a great deal of eggs in the GM basket; citing the Wall Street Journal as their source, Automotive News reports that Buffet’s Berkshire Hathaway collected another 1 million GM shares in Q4 of last year, and Soros Fund Management scooped up an additional 728,938 shares. That brings the two firms’ share counts up to 41 million and 4.9 million, respectively.
General Motors has received a lot of pressure as of late to increase shareholder value, and deliver bigger dividends to its investors from its stockpile of cash and securities. Just recently we learned that Harry Wilson, a pivotal member in restructuring both GM and Chrysler during the bailout period, announced last week his intent to garner a spot on GM’s board so that he can attempt to initiate an $8 billion buyback of company stock.
Wilson wrote GM, saying that “the company’s common stock is substantially undervalued, the company is substantially overcapitalized and this repurchase of undervalued shares will create substantial shareholder value.” But General Motors also announced last week its plans to increase its dividends to shareholders by 20 percent, up to 36 cents per share, per quarter.
If Wilson were to secure a place on GM’s board, and successfully implement such a large buyback, that could turn into a very welcome payday for both Berkshire Hathaway and Soros Fund Management.