Buffett Keeps Riding The Reading Railroad (BNI)

Burlington Northern Santa Fe Corp. (NYSE: BNI) does not have a new shareholder.  But Warren Buffet’s Berkshire Hathaway Inc. (NYSE: BRK-A) did increase the size of the stake held in Burlington Northern.  In another unusual Buffett style move, this was not just a normal "let’s just buy some more of this one."

Warren Buffett and friends exercised options contracts on the vestingand expiration date of December 11 at $75.45 for some 2,217,500shares.  Buffett now holds 70,089,029 shares, or a stake of 20.47% inBurlington Northern.

This is via the National Indemnity Company subsidiary of BerkshireHathaway.  As reported on a Form 4 filed December 5, the "NICO"unit wrote a put option on December 3,  pursuant to which it isobligated to buy 2,325,000 shares of BNI Common Stock from Citibank,N.A. for an exercise price of $75.00 per share, if Citibank exercisesthe put option.

Shares closed up 0.2% today at $71.53.  The 52-week trading range is $68.31 to $114.58.

• Buffett did another synthetic trade like this in BNI, which he was later "put" in the shares.
• Full Buffett Holdings as of his last report

Jon C. Ogg
December 15, 2008