B of A rallies 24% on Buffett's $5 billion stake ( BRK.A BRK.B BAC ) (by Steve Gelsi)
NEW YORK (MarketWatch) -- Bank of America Corp. (bac) rallied 24% to $8.67 a share in pre-market trades on Thursday after billionaire Warren Buffett's investment company Berkshire Hathaway (brka) (brkb) said it would invest $5 billion in the financial conglomerate. Berkshire agreed to purchase 50,000 shares of cumulative preferred stock with a liquidation value of $100,000 a share in a private offering. The preferred stock carries an annual dividend yield of 6% and is redeemable by the company at any time at a 5% premium. "I am impressed with the profit-generating abilities of this franchise, and that they are acting aggressively to put their challenges behind them," Buffett said in a statement.