Each day, Benzinga takes a look back at a notable market-related moment that occurred on this date.
What Happened? On May 10, 1965, Warren Buffett took control of Berkshire Hathaway (NYSE:BRKa), Inc. (NYSE: BRK-A)(NYSE: BRK-B).
Where The Market Was: The Dow finished the day at 931.47. The S&P 500 traded at 89.66.
What Else Was Going On In The World? In 1965, the construction of the St. Louis Gateway Arch was completed. The 1965 Voting Rights Act guaranteed the right to vote for African Americans. A gallon of gasoline cost 31 cents.
Buffett Takes The Reins: Ironically, in 1964, Warren Buffett intended to sell his 7% stake in Berkshire Hathaway, which was at that time a failing textile company. Buffett had even reached a verbal agreement with Berkshire president Seabury Stanton to sell his Berkshire shares at a price of $11.50.
That plan changed when Stanton sent Buffett an official offer to buy the shares at a price of just $11.375 per share. The price angered Buffett, who rejected the deal and instead began buying up shares of Berkshire. By early 1965, Berkshire’s share price was up to $15. On May 10, 1965, Stanton resigned as president of Berkshire, citing disagreements with an “outside interest.” Buffett had taken over control of Berkshire by purchasing a 40% ownership stake in the company.
Today, Berkshire’s Class A stock trades at roughly $471,000 per share and the company is valued at $692 billion.
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