Berkshire Doubles Down on Italian Tech Acquirer Bending Spoons
TREE NEWS reports: Berkshire Hathaway has increased its stake in Bending Spoons, the Italian technology acquisition company, with an additional $330 million investment. The move, executed through a private placement of 10 million ordinary shares at $33 each, raises Berkshire’s ownership to 4%. Following the announcement, Bending Spoons’ stock skyrocketed over 41% in a single day, reaching a market capitalization of $34 billion. Since its IPO in July, the shares have climbed nearly 84% from the first-day close. Berkshire’s Class A shares also rose 1.2% on the news.
Bending Spoons: The “App Renovation Factory”
Founded in 2013 in Milan, Bending Spoons specializes in acquiring mature digital applications that have lost growth momentum. It then restructures them through large-scale layoffs, AI-driven code rewrites, and pricing adjustments to generate stable cash flow, which is reinvested into further acquisitions. Its portfolio includes former internet darlings like AOL, Vimeo, Evernote, and Eventbrite. The company has completed over 50 acquisitions and identified more than 1,000 potential targets in Europe and North America.
CEO Luca Ferrari has stated that the company allocates capital to maximize earnings per share 10 or 20 years down the line, regardless of the specific product vertical. He believes Bending Spoons can eventually be worth hundreds of billions of dollars. The company’s financials show revenue doubling for two consecutive years, from $387 million in 2023 to $1.3 billion in 2025, with gross profit rising from $236 million to $857 million. Although net income fell to break-even in 2025 due to acquisition costs, the market remains enthusiastic about its model.
Market Implications
This investment signals a more aggressive capital deployment strategy under new Berkshire CEO Greg Abel, who has already invested nearly $20 billion in equities in the second quarter, ending a three-year net selling streak. With $365 billion in cash, Berkshire’s moves are closely watched. The market’s positive reaction to the Bending Spoons deal suggests investors view this as a vote of confidence in Abel’s leadership and in the tech-focused acquisition model. The deal could also spur interest in similar roll-up strategies in the tech sector, potentially benefiting other companies that focus on acquiring and optimizing legacy software assets.
For investors, the key takeaway is that Berkshire’s backing provides a strong endorsement for Bending Spoons, but the company’s controversial practices—such as mass layoffs and limited financial disclosure—pose risks. The stock’s rapid ascent may also raise valuation concerns. However, the success of this investment could encourage more traditional value investors to explore opportunities in the tech space, particularly in undervalued software assets with recurring revenue.
Key Takeaways
- Berkshire Hathaway’s additional $330 million investment in Bending Spoons boosts its stake to 4%, driving the stock up over 41% in a day.
- Bending Spoons’ strategy of acquiring and revitalizing mature apps has delivered strong revenue growth, attracting Berkshire’s backing.
- The deal underscores Berkshire’s accelerated capital deployment under Greg Abel, potentially influencing market sentiment towards tech acquisitions.
- Investors should weigh the endorsement against risks like layoffs and opaque financials, and monitor valuation after the sharp rally.
