Warren Buffett's Berkshire Hathaway will exercise warrants in Bank of America allowing it to acquire 700 million common shares at an exercise price of $7.14 each, or about $5 billion. At Thursday's closing price of $24.32, that stake is worth more than $17 billion. So it's a quick $12 billion paper profit.
This all goes back to Berkshire's 2011 deal to invest $5 billion in preferred shares of Bank of America, which at the time was struggling with numerous legal issues in the wake of the subprime mortgage crisis. Berkshire will also become the bank's largest shareholder, surpassing Vanguard.
Wouldn’t it be nice...
