Warren Buffett’s Berkshire Hathaway (NYSE:BRK.B) announced an agreement to acquire Occidental Petroleum’s petrochemical unit (OxyChem) for $9.7 billion in cash. OxyChem manufactures basic chemicals such as chlorine, sodium hydroxide, and vinyl derivatives used in water treatment, healthcare, and construction.
The deal will be Berkshire’s largest acquisition since 2022, when it paid $11.6 billion for insurer Alleghany. Occidental said it will allocate $6.5 billion from the sale to reduce its net debt, which totaled $23.34 billion in June.
Shortly after the announcement, shares of Occidental Petroleum (NYSE:OXY) rose 0.6% in pre-market trading on Thursday, October 2, 2025, while Berkshire Class B shares fell 0.3%.
Occidental’s oil and gas business accounted for 75% of its profit last year. Berkshire is already a significant shareholder in Occidental, with a stake of nearly 28% as of June.
Buffett has ruled out taking full control of the oil company, expressing interest only in the chemical subsidiary. He is expected to step down as CEO at the end of the year, to be succeeded by Greg Abel in 2026.
The sale of OxyChem is part of Occidental’s divestments to strengthen its balance sheet. Since 2023, the company has divested approximately $4 billion in assets and set a goal of reducing its senior debt to less than $15 billion.
According to Occidental, the OxyChem unit recorded revenue of US$2.42 billion in the first half of 2025 alone, but faces margin pressure and oversupply in the sector.
From Berkshire’s perspective, Buffett and his team are once again pursuing major acquisitions after years of caution. The purchase will be financed with part of their record $344 billion cash hoard, accumulated as of June.
The deal also marks Berkshire’s return to the chemicals sector after more than a decade, since its acquisition of Lubrizol for about $10 billion in 2011. The transaction still requires regulatory approvals and is expected to close in the fourth quarter of 2025.
Berkshire Hathaway stock price
Occidental Petroleum stock price
This content is for informational purposes only and does not constitute financial, investment, or other professional advice. It should not be considered a recommendation to buy or sell any securities or financial instruments. All investments involve risk, including the potential loss of principal. Past performance is not indicative of future results. You should conduct your own research and consult with a qualified financial advisor before making any investment decisions.