But don't worry! It's delicious Buffett-flavored dilution.TM
Berkshire Hathaway will invest $5 billion in Goldman Sachs. In addition, Goldman will raise at least $2.5 billion in common equity in a public offering. Berkshire will have warrants to buy another $5 billion in common stock. -- WSJ
I don't think I have to tell you, this is huge, people. Consider the out of nowhere sex analogies that will come from the Oracle of O diving into bed (or up on a desk, or behind a back alley) with LB. That's probably half the reason he agreed to this thing. Threesome-view with Blankfein, Buffett and his gal-pal Becky Quick tomorrow morning? CNBC hasn't said anything but we've got our fingers crossed.
Update: The Quickster just confirmed to Kudlow that the interview will go down tomorrow at 8 am! Obviously, we will be live blogging the fuck out of it.
Update 2: Goldman's press release:
New York, NY - September 23, 2008 -- The Goldman Sachs Group, Inc. (NYSE: GS) announced today that it has reached an agreement to sell $5 billion of perpetual preferred stock to Berkshire Hathaway, Inc. in a private offering. The preferred stock has a dividend of 10 percent and is callable at any time at a 10 percent premium. In conjunction with this offering, Berkshire Hathaway will also receive warrants to purchase $5 billion of common stock with a strike price of $115 per share, which are exercisable at any time for a five year term.
In addition, Goldman Sachs is raising at least $2.5 billion in common equity in a public offering.
"We are pleased that given our longstanding relationship, Warren Buffett, arguably the world's most admired and successful investor, has decided to make such a significant investment in Goldman Sachs. We view it as a strong validation of our client franchise and future prospects," said Lloyd C. Blankfein, Chairman and CEO of The Goldman Sachs Group, Inc. "This investment will further bolster our strong capitalization and liquidity position."
"Goldman Sachs is an exceptional institution," said Warren Buffett, Chairman and CEO of Berkshire Hathaway, Inc. "It has an unrivaled global franchise, a proven and deep management team and the intellectual and financial capital to continue its track record of outperformance."
The Goldman Sachs Group is a bank holding company and a leading global investment banking, securities and investment management firm. Goldman Sachs provides a wide range of services worldwide to a substantial and diversified client base that includes corporations, financial institutions, governments and high net worth individuals. Founded in 1869, the firm is headquartered in New York and maintains offices in London, Frankfurt, Tokyo, Hong Kong and other major financial centers around the world.