Warren Buffett plans to donate $140 billion Berkshire stake by 2034

Warren Buffett plans to donate his remaining $140 billion Berkshire Hathaway stake to family foundations by the end of 2034, the company said July 14.

"My goal is to dispose of all of my Berkshire shares within about eight years," Buffett, chairman and former CEO of Berkshire Hathaway, said in a news release.

The initial tranche of 12 million Class B shares, worth about $5.96 billion based on the July 13 closing price of $496.85, was split among four foundations. The Susan Thompson Buffett Foundation received 9 million shares, while the Sherwood Foundation, the Howard G. Buffett Foundation and the NoVo Foundation each received 1 million shares. Buffett still holds 188,290 Class A shares and 1,162 Class B shares, representing about 13 percent of Berkshire's $1.05 trillion market capitalization.

The donation marks a sharp break from Buffett's previous strategy of channeling funds through the Bill & Melinda Gates Foundation, which received $48 billion over 19 years. Buffett has distanced himself from Gates after the Microsoft co-founder's ties to Jeffrey Epstein emerged during congressional testimony earlier this year.

The four foundations are run by Buffett's three children — Susie, Howard and Peter — who will oversee the distribution of the remaining shares. Buffett said he does not review their charitable decisions, telling CNBC he has "never looked at their Form 990s."

The planned full divestiture raises questions about Berkshire's future capital allocation. The company has historically reinvested earnings rather than paying dividends, but the foundations may eventually push for a payout to fund their philanthropic activities, similar to how the Hormel Foundation and the Hershey Trust use dividends from their equity stakes to support charitable giving.

Berkshire's stock has lagged the broader market, delivering total returns of about 235 percent over the past decade compared with the S&P 500's 314 percent. New CEO Greg Abel faces the challenge of maintaining Berkshire's investment discipline as Buffett's influence recedes.

The transition gives Buffett's children control over the largest philanthropic transfer in US history. The foundations will need to decide whether to hold Berkshire shares or diversify, a choice that could affect the company's shareholder base for years to come. Investors will watch for any changes in Berkshire's dividend policy or capital allocation strategy as the 2034 deadline approaches.

This article is for informational purposes only and does not constitute investment advice.