(MENAFN- Live Mint) Warren Buffett's insurance chief and top executive, Ajit Jain, sold more than half his stakeholding in Berkshire Hathaway, according to a nasdaq regulatory filing on Wednesday, September 11.
Ajit Jain, the 73-year-old vice chairman of insurance operations, sold 200 Berkshire Class A shares on Monday at an average price of $695,418 per share for nearly $139 million. Jain now holds 61 shares, while family trusts established by himself and his spouse for the benefit of his descendants hold 50 shares, and Jain Foundation, his non-profit corporation, holds 50 shares, as per the filing.
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Monday's 200 share stake sale was 55 per cent of his total stakeholding in Berkshire Hathaway .
This selloff marks the biggest reduction in Jain's holding in Berkshire since he joined in 1986. The motivation behind Jain's stake sale is unclear; he did take advantage of the company's recent high price. The American conglomerate traded above $700,000 to hit a $1 trillion market capitalization at the end of August, as per a CNBC report.
“This appears to be a signal that Ajit views Berkshire as being fully valued,” said David Kass, a finance professor at the University of Maryland's Robert H. Smith School of Business, cited the report.
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It is consistent with the slowdown in Berkshire's share buyback activity as of late. Omaha , Nebraska-based Berkshire bought back $345 million worth of its own stock in the second quarter, lower than $2 billion repurchased in each of the pro quarter, according to the report.
“I think at best it is a sign that the stock is not cheap,” said Bill Stone, chief investment officer (CIO) at Glenview Trust Co. and a Berkshire shareholder.“At over 1.6 times book value, it is probably around Buffett's conservative estimate of intrinsic value . I don't expect many, if any, stock repurchases from Berkshire around these levels,” he said, quoted in the agency report.
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