Warren Buffett is famous for keeping his money away from the technology business. But the legendary investor has suddenly changed his spots.
On Monday, Buffet told CNBC that since March, his Berkshire Hathaway investment house has purchased over $10.7 billion in IBM stock.
In the past, Buffett consciously avoided technology companies in favor of more stable outfits such as Kraft Foods or Coca-Cola. Speaking to CNBC, Buffet said he has read IBM's annual report every year for the past 50 years, but when he read the 2010 report, he saw the company in a new light. "I just came away with a different view of the position that IBM holds within IT departments, why they hold it and the stickiness," he told CNBC. "I should have paid more attention to it five years ago."
In recent years, IBM has transformed itself into a company that provides a wide range of IT services to the world's businesses, and under CEO Sam Palmisano, it has pushed into new markets across the globe. Buffet said Palmisano has "delivered big time," and he mentioned Big Blue's global reach in particular.
"Now, I would imagine if you're in some country around the world and you're developing your IT department, you're probably going to feel more comfortable with IBM than with many companies," Buffet said, after pointing to IBM's big financial gains in over 40 countries during its most recent quarter.
IBM announced in late October that senior vice president and group executive for sales, marketing, and strategy Viginia Rometty will take over for Palmisano on January 1. Rometty was instrumental in IBM's transformation into an IT services business as well as its push across emerging markets such as China and Brazil.
Buffet said he now owns about 5.5 percent of the company, which could make him the single largest investor in the company. IBM did not immediately respond to a request for comment.
