Berkshire More Than Doubled Stake in Nucor

Warren Buffett’s Berkshire Hathaway Inc. more than doubled its stake in Nucor Corp. in the third quarter of 1998 to 4.1 million shares, according to a regulatory filing just made public. In the previous quarter, Berkshire had reported holding almost 1.9 million shares in the second-largest U.S. steelmaker, which is based in Charlotte, N.C. The addition of Nucor shares was reported in a filing submitted to the Securities and Exchange Commission more than a year ago and kept confidential until now. Buffett added to Berkshire’s Nucor holdings around the time the steelmaker was struggling to compete with cheap imports from Asian and Eastern European rivals. On Sept. 30, 1998, Nucor shares had fallen as low as $35.25, their lowest price in at least five years. “It seems kind of a prescient prediction considering the recovery of the steel industry,” said Fred Hult, an analyst at New York-based Carson Group. Nucor shares closed at $56, up $1.63, on the NYSE and are up about 29% this year. The confidential filing also confirmed what some investors had suspected: Berkshire sold all its shares in McDonald’s Corp., Morgan Stanley Dean Witter & Co., and Travelers Group Inc. by Sept. 30, 1998. Travelers has merged with Citigroup Inc. The sale of all Berkshire’s McDonald’s shares illustrates the size of what Buffett had described in an annual letter to shareholders as “a very big mistake.” As of Dec. 31, 1997, Berkshire held 15.2 million McDonald shares. McDonald’s saw its shares gain 61% last year, outstripping Berkshire’s own 52% increase. McDonald’s shares are up 6% this year. They closed off 19 cents at $40.63 on the NYSE.