Berkshire Strikes a $9.7B Deal for OxyChem

Berkshire Hathaway (NYSE: BRK.A, BRK.B) is buying Occidental Petroleum’s (NYSE: OXY) chemical division, OxyChem, for $9.7 billion. The transaction may mark the last major acquisition under Warren Buffett before he hands the CEO reins to Vice Chair Greg Abel in January 2025.

Although Buffett was not mentioned in Thursday’s release, his longstanding relationship with Occidental CEO Vicki Hollub suggests he had a role. Buffett has often been directly involved whenever Berkshire spends more than $1 billion.

Preparing for Leadership Transition

Greg Abel issued the official statement, calling OxyChem “a robust portfolio of operating assets.”
Analysts say Abel taking the lead signals Berkshire’s CEO transition planning.
Edward Jones analyst Jim Shanahan noted investors are watching how Abel’s style—more hands-on than Buffett—could change Berkshire’s approach to acquisitions.

Buffett will remain chairman and continue steering Berkshire’s $344B cash reserves.

What Berkshire Gets: OxyChem’s Business

OxyChem manufactures:

Chlorine (water treatment)
Vinyl chloride (plastics)
Calcium chloride (road treatment)
Other specialty chemicals

The unit generated $213M pretax earnings in Q2 2025, down from ~$300M last year. The acquisition fits alongside Lubrizol, which Buffett bought for $9B in 2011.

Occidental’s Strategy: Deleveraging the Balance Sheet

Occidental will use $6.5B of the proceeds to pay down debt, aiming to reduce principal debt below $15B.
The company has already sold ~$4B in assets since acquiring CrownRock in Dec. 2023 to manage its $7.5B debt burden.
Occidental will retain all legacy environmental liabilities for OxyChem.

Berkshire’s Broader Occidental Relationship

Berkshire is already deeply tied to Occidental:

Holds 28% equity stake in OXY.
Owns warrants for ~84M shares at $59.59 per share.
Owns $8.5B in preferred shares from 2019, paying 8% dividends annually.

Buffett has repeatedly told shareholders he has no intention to acquire all of Occidental, but has been gradually increasing Berkshire’s stake.

Broader Berkshire Portfolio & Strategy

Berkshire owns dozens of businesses, including Geico, BNSF railroad, utilities, Dairy Queen, See’s Candies.
Its stock portfolio exceeds $250B, with large positions in Apple, Coca-Cola, Bank of America, and American Express.
The OxyChem purchase uses less than 3% of Berkshire’s cash, keeping its acquisition “firepower” intact.

Deal Closing

The OxyChem deal is expected to close in Q4 2025, pending regulatory approval.