Buffett Strikes as Investors Flee; Buys Energy Firm

In his first move of the current market crisis, the Oracle collects more energy
By Clay Dillow,  Newser Staff
Posted Sep 19, 2008 10:01 AM CDT
Billionaire investor Warren Buffett bought Baltimore energy company Constellation, adding to his growing energy holdings.   (AP Photo)
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(Newser) – Warren Buffett swooped in yesterday with one of his patented moves, his first during the current market turmoil. He purchased Constellation Energy Group, Baltimore’s large hometown energy supplier, after its stock plummeted by 60 percent since Monday, the Sun reports. As investors fled the company, Buffett saw opportunity, adding to the vast energy holdings that now account for about 10% of Berkshire Hathaway’s revenue.

Buffett has a legacy of rescuing good companies in troubled times—Coca-Cola, American Express, Gilette and others that make everyday products—and has amassed $50 billion collecting simple companies with strong brand recognition. Though troubled now, Berkshire has the capital to turn Constellation’s fortunes around; when the company last sought a buyer in 2005, the offer was more than $12 billion before the deal collapsed. Buffet paid $4.7 billion.