Billionaire investor Warren Buffett has agreed a deal which will see his firm Berkshire Hathaway invest $5bn in Bank of America.
The bank's share price has tumbled this year as investors fret over the health of the bank, but the stock rose 17% in early US trading today following news of the deal. There had been fears BofA would need to go to public markets to raise capital, with shares halving in value as a result. However, today Buffett gave his support to the bank, backing its strategy and labelling it a "strong, well-led company." The deal sees the Bank of America selling 50,000 shares of cumulative perpetual preferred stock with a liquidation value of $100,000 per share to Berkshire Hathaway in a private...
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