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Warren Buffett’s Berkshire Hathaway is set to plow more than $550 million into Snowflake when the cloud-data company goes public | Markets

Warren Buffett

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  • Warren Buffett’s Berkshire Hathaway is set to invest more than $550 million in Snowflake when it goes public, according to the cloud-data group’s amended S-1 filing.
  • The billionaire investor’s company will buy about 3.1 million Class A shares in a private placement, and purchase another 4 million shares from former Snowflake CEO Robert Muglia.
  • Salesforce’s strategic venture arm has also agreed to invest $250 million in Snowflake stock.
  • Berkshire’s bet is striking as Buffett has historically stuck to companies he understands, and joins a string of unusual moves from Berkshire, such as investing in a gold miner and acquiring 5% stakes in five Japanese trading companies.
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Warren Buffett’s Berkshire Hathaway has agreed to invest $250 million in Snowflake when it goes public in the coming weeks, according to the cloud-data company’s amended S-1 filing.

The famed investor’s conglomerate will purchase roughly 3.1 million Class A shares in a private placement, based on the $80 midpoint of Snowflake’s expected IPO price range of $75 to $85.

Buffett’s company has also agreed to buy another 4 million Class A shares from former Snowflake CEO Robert Muglia in a secondary transaction, paying the IPO price for each share. That could cost it $303 million to $344 million based on the expected price range.

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If both purchases go through, Berkshire might spend upwards of $550 million for more than 7 million shares, representing about 19% of the 38.3 million Class A shares that Snowflake expects to be outstanding after its offering.

Salesforce has also agreed to purchase $250 million of Snowflake stock through its strategic venture arm, Salesforce Ventures, the filing shows.

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Snowflake declined to comment in an email to Business Insider.

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Berkshire’s latest bet is striking as Buffett famously eschews tech stocks, preferring to invest in businesses he understands. It joins a flurry of surprising moves from his company, including its first investment in a gold miner and deep cuts to its stakes in JPMorgan, Wells Fargo, and other financial companies last quarter.

Buffett’s company also disclosed 5% stakes in the five biggest Japanese trading companies or “sogo shosha” last week, and bought $2.1 billion of Bank of America stock over 12 straight trading days to August 4.

Snowflake was founded in 2012 and privately valued at $12.4 billion in February. Its revenues surged 121% year-on-year to $133 million in the the three months to July 31, helping to narrow its operating loss by 19% to $78 million.

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