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A Buffett investment that wasn't
Submitted on 11/20/2007
With auto stocks beaten down, prominent investors looking for bargains have been on the prowl. Kirk Kerkorian bought nearly 10% of General Motors's shares last year, which he subsequently sold, and Cerberus Capital Management, the private equity group, took majority control of Chrysler earlier this year.
Last week, it began to look as if CarMax, one of the pioneers of the used-car superstore, had become the next target. Legndary investor Warren Buffett was said to be buying in. Headlines like "Buffett buys major stake in CarMax" and "Buffett Buy Sends CarMax shares soaring" appeared. Copycat investors sent CarMax's stock price shooting up when the news broke on November 15.
Stories about the Berkshire billionaire buying into CarMax were not quite what they seemed.
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