Warren Buffett’s Berkshire Hathaway Inc. has struck what could be one of the most significant deals of the billionaire investor’s storied career, agreeing to acquire the chemical division of Occidental Petroleum Corp., known as OxyChem, for $9.7 billion in an all-cash transaction. Announced on Thursday, this move marks Berkshire’s largest acquisition since its 2022 purchase of insurer Alleghany Corp. for $11.6 billion, and it comes amid speculation that the 95-year-old Buffett may be winding down his direct involvement in major deals. The transaction, expected to close by the end of 2025, underscores Buffett’s enduring strategy of deploying Berkshire’s massive cash reserves into stable, cash-generating businesses.

Details emerging from the deal reveal that OxyChem, a leading producer of chemicals like chlorine and vinyls, will become a wholly owned subsidiary of Berkshire, adding to its diverse portfolio that already includes energy giants like Berkshire Hathaway Energy. Occidental, which has been under pressure to reduce debt following its 2019 acquisition of Anadarko Petroleum, will use the proceeds to pay down borrowings, potentially strengthening its balance sheet in a volatile oil market. Buffett, who already holds a significant stake in Occidental through Berkshire’s common shares and preferred stock, praised the unit’s “strong standalone business” in a statement, echoing his long-held preference for companies with durable competitive advantages.

A Strategic Fit in Buffett’s Empire
This acquisition aligns seamlessly with Berkshire’s history of bolstering its industrial and energy holdings, a pattern that has defined much of Buffett’s tenure since he took control of the former textile company in 1965. Industry analysts note that OxyChem’s operations, which generated about $5 billion in revenue last year, complement Berkshire’s existing chemicals exposure through units like Lubrizol, acquired in 2011 for $9 billion. According to a report in Fortune, the deal represents a “genius win-win,” allowing Occidental to deleverage while handing Berkshire a reliable earnings stream amid economic uncertainty.

Market reactions were mixed, with Occidental shares dropping over 7% on the announcement day, as investors weighed the loss of a high-margin business against debt relief. Berkshire’s Class A shares, meanwhile, edged up slightly, reflecting confidence in Buffett’s capital allocation prowess. Posts on X (formerly Twitter) from financial commentators highlighted the timing, with one noting Berkshire’s “staggering $348 billion cash pile” as of mid-2025, per disclosures at the company’s annual meeting, enabling such opportunistic buys without financing needs.

Implications for Succession and Legacy
As Buffett prepares to hand over the CEO reins to Vice Chairman Greg Abel at year’s end—a transition announced earlier in 2025—this deal may indeed be his swan song in large-scale acquisitions. Abel, who has overseen Berkshire’s non-insurance operations since 2018, is expected to maintain the conglomerate’s conservative approach, but insiders speculate he might accelerate diversification into renewables, given criticisms of Berkshire Hathaway Energy’s reliance on coal plants, as detailed in a 2025 Reuters investigation cited in Wikipedia‘s entry on the company.

The broader context reveals Buffett’s recent caution: Berkshire has been a net seller of equities for ten straight quarters, trimming stakes in Apple Inc. and Bank of America Corp., while building cash reserves to a record high. This OxyChem purchase, however, signals a return to Buffett’s classic playbook of buying quality assets at reasonable prices during market dislocations. A CNN Business article described it as Berkshire’s “biggest deal in three years,” emphasizing how it bolsters the company’s exposure to petrochemicals amid global supply chain shifts.

Market Sentiment and Future Outlook
Sentiment on X has been buzzing, with users like financial aggregator accounts praising the move as a defensive play in an inflationary environment, though some express concerns over chemical industry headwinds like rising raw material costs. Occidental’s stock plunge, detailed in a Livemint report, underscores investor fears that shedding OxyChem might weaken the company’s diversification away from oil price swings.

Looking ahead, the deal could reshape competitive dynamics in the chemicals sector, where OxyChem holds a top position in U.S. vinyl production. For Berkshire, it adds resilience to its portfolio, which Buffett has often likened to a “fortress” against economic storms. As one AP News piece put it, this $9.7 billion transaction “may be the last big acquisition involving the consummate dealmaker,” cementing Buffett’s legacy as a patient capital allocator who turned a struggling textile firm into a $900 billion behemoth.

Broader Economic Ramifications
Critics, however, point to environmental concerns, noting OxyChem’s involvement in energy-intensive processes that could clash with growing ESG pressures. A Washington Post analysis highlighted Berkshire’s ongoing operation of polluting coal plants until at least 2049, raising questions about the conglomerate’s sustainability commitments post-Buffett.

Nevertheless, the acquisition exemplifies Buffett’s timeless investment philosophy: buy businesses with “moats” that generate predictable cash flows. With Abel poised to lead, industry watchers anticipate more such deals, potentially targeting undervalued assets in transportation or manufacturing. As a Yahoo Finance breakdown noted, this move not only deploys idle cash but also positions Berkshire for long-term growth in a post-Buffett era, ensuring the Oracle’s influence endures.