During Berkshire Hathaway’s annual meeting last week, Warren Buffett went into a lot of detail about his position in Activision Blizzard (ATVI) to capture the arbitrage spread on the deal. This position was distinct from the position one of his managers, Ted Weschler and Todd Combs, had started before the $95 per share all cash deal with Microsoft (MSFT) was announced on January 18, 2022. Incidentally Barry Diller, his step-son Alexander von Furstenberg and David Geffen also had started a position in Activision Blizzard (ATVI) through an options trade before the deal was announced. The timing of their trade caused JPMorgan Chase to report the trade to law enforcement and it is currently being investigated. Mr. Diller denied the accusations and indicated that it was just a lucky bet.
Berkshire Hathaway’s purchases of Activision Blizzard before the deal was announced were also the subject of a WSJ article and Buffett wrote this letter to various news outlets to clarify that the position was started long before the acquisition was announced and at prices that could be replicated after the announcement.