Tuesday saw a sharp increase in Taiwan Semiconductor Manufacturing Company stock after Warren Buffett’s Berkshire Hathaway revealed that it has invested $4.1 billion in one of the biggest chipmakers in the world.
TSMC (TSM) depository shares were acquired by Berkshire Hathaway (BRKA) in the three months ending September, according to a document made with the US Securities and Exchange Commission on Monday.
On Tuesday, TSMC stock rose by more than 8% in Taiwan.
A TSMC representative stated that the chipmaker “welcomes all investors with the predisposition to buy and hold TSMC’s stock.”
According to estimates, TSMC produces 90% of the most sophisticated computer chips in the world, serving companies like Apple (AAPL) and Qualcomm (QCOM).
As tensions between China and the autonomous, democratic island nation rise, Berkshire purchases a share in the Taiwanese chip powerhouse.
Due to Beijing’s increasing military hostility toward Taiwan in recent months, the crucial role Taiwan plays in the world’s chip manufacturing industry has come to light.
Given the high cost of development and the degree of expertise necessary, it is challenging to build super-advanced semiconductor chips like those made by TSMC, which is why the majority of the manufacturing is concentrated in just a few vendors.
According to the defense ministry, the company, which is known as Taiwan’s “sacred mountain,” is so crucial to the island that its employees are eligible to request an exemption from military reservist training.
President Joe Biden recently imposed a broad set of regulations on the sale of advanced semiconductors and chip-making equipment to Chinese enterprises, which has contributed to the recent rise in tensions between Washington and Beijing over chips. The tech weapons race between China and the United States might potentially reach a whole new level as a result of these regulations, experts worry.
Additionally, Berkshire holds sizable investments in American Express, Apple, Bank of America, Coca-Cola, and Chevron.
