Tesco investment was a huge mistake, says Warren Buffett

LONDON: Billionaire investor Warren Buffett said his investment in Tesco was a “huge mistake,” as the UK supermarket leader’s share price remains close to an 11-year low amid declining sales and an accounting probe.

“I made a mistake on that one,” Buffett, 84, said in an interview with CNBC on October 2. “That was a huge mistake by me.” Buffett’s Berkshire Hathaway has held Tesco shares since March 2006, when it acquired a stake for $328.7 million. By 2012, the holding had reached 5.08% of the grocer’s shares, worth about 1.3 billion pounds ($2.1 billion).

More recently, Buffett has been cutting the stake, owning 3.7% of the shares as of December 31, according to Berkshire Hathaway’s annual report.

The holding’s value has slumped in the past year as Tesco has lowered its profit outlook amid a shift by shoppers toward discount and upscale chains.

The shares are down 49% in the past 12 months, slumping 17% last week after new chief executive officer Dave Lewis started a probe of accounting practices and suspended four executives after finding that Tesco overstated first-half profit estimates.