Warren Buffett Donates 9.4M Berkshire Shares to the Gates Trust Despite Rumoured Rift With Bill Gates

Legendary investor Warren Buffett, 94, has commenced his previously announced estate planning strategy.

According to the latest US Securities and Exchange Commission filing, the Oracle of Omaha converted 8,239 class A shares of Berkshire Hathaway into 12.35 million class B shares of common stock, where each class A share is convertible into 1,500 class B shares.

Buffett then donated over 9.4 million of those converted class B shares to the Gates Foundation Trust. While the filing highlighted that these donations are pursuant to Buffett's lifetime commitments, it is unclear why Gates sold over 7.4 million class B shares of Berkshire Hathaway in the past three consecutive quarters.

Buffett's significant stock donation to the Gates Foundation comes despite a rumoured strained relationship with Bill Gates in recent years. Gates joined Berkshire Hathaway's board in 2004 until 2020, and Buffett served as a member of the Bill and Melinda Gates Foundation until 2021, shortly after the couple announced their divorce.

In 2006, Buffett had pledged to donate 85% of his Berkshire Hathaway stake to charity, most of which was supposed to go to Gates' foundation. However, he revealed in an interview with The Wall Street Journal last year that the donations to Gates' foundation would stop after he passes away.

Although Buffett didn't divulge many details behind his decision, the investor had earlier said while resigning from the Gates Foundation board that his goals are 100% in sync with those of the foundation, and that his 'physical participation is in no way needed to achieve these goals.'

2.9M Shares to Family Foundations as Part of Estate Planning

The regulatory filing with the SEC also revealed that Buffett donated 943,384 shares to the Susan Thompson Buffett Foundation, named after his late first wife, and 660,366 shares to each of the Sherwood Foundation, the Howard G. Buffett Foundation, and the NoVo Foundation, which are run by his three children.

In an earlier news release, Buffett had said he plans to donate a total of 1.5 million class B shares to The Susan Thompson Buffett Foundation and 900,000 to each of the family foundations led by Howard Graham Buffett, Peter Buffett, and Susan Alice Buffett.

Buffett's elaborate estate plan will also see his eldest son, Howard, become Berkshire's non-executive chairman. While Howard thinks it won't be easy to assume that role and distribute his father's wealth according to his wishes, he is confident his siblings would come together and use their experiences to take risks that make a difference. 'I can tell you, we'll sit down in a room when the time comes, and we'll get it figured out pretty quickly,' he had said earlier.

The latest donation of over 12.35 million Berkshire shares is valued at almost £4.3 billion ($6 billion) based on the latest closing price of £352.47 ($485.77) per class B share. The filing showed that Buffett still holds 198,117 of class A Berkshire shares.

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