Dive Brief:
- Money manager David Winters created a frenzy in the markets yesterday with a letter suggesting that legendary investor Warren Buffett might be involved in a secret, "sweetheart" deal to privatize Coca-Cola.
- Buffett, whose Berkshire Hathaway fund controls slightly more than 9% of Coke share, denied such a plan, telling CNBC there was "absolutely no chance of that."
- Buffett and Winters have tangled previously. Winters led the battle against a controversial pay package for Coke executives and demanded that Buffett help stop it. Buffett declined to fight it.
Dive Insight:
Speculation and rumor are what Wall Street lives on. So it should never be a surprise when share prices move based on what someone, somewhere suggests might happen.
But in this case, Winters and the investment community have some reason to worry that Buffett and his colleagues at private equity fund 3G Capital are planning a deal to take control of Coke. That is, after all, what they did with Heinz.