Buffett takes Munich Re stake for $1bn investment

BILLIONAIRE US investor Warren Buffett has built a $1bn (£619m) stake in Munich Re, boosting his insurance holdings by taking a three per cent stake in the world’s biggest reinsurer.

Munich Re said yesterday Buffett’s shareholding rose just above the mandatory reporting threshold on 18 January and amounted to 3.045 per cent of voting rights on that date.

Analysts said Buffett’s stake was more likely financial than strategic because insurance companies, which buy protection for themselves from reinsurers, would shy away from giving too much business to allied reinsurance suppliers.

Buffett is already a major player in the world’s reinsurance market with his Berkshire Hathaway unit, the world’s third-biggest reinsurer.

The billionaire investment icon also pumped 3bn Swiss francs (£1.78bn) into Swiss Re during the financial crisis after the Swiss group wrote down billions on illiquid assets.