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NEW YORK – Warren Buffett on Saturday said he made a “big mistake” investing in a utility that was the subject of one of the biggest leveraged buyouts ever, but now may be on the road to bankruptcy.

In his annual letter to shareholders of his Berkshire Hathaway Inc, Buffett said he regretted buying US$2 billion of bonds of Energy Future Holdings Corp, created in 2007 from the US$45 billion buyout of Dallas-based TXU Corp.

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Buffett, the so-called Oracle of Omaha and the world’s fourth-richest person, had bought the bonds without consulting his second-in-command, vice chairman Charlie Munger.

“Most of you have never heard of Energy Future Holdings. Consider yourselves lucky; I certainly wish I hadn’t,” Buffett, 83, said. “Next time I’ll call Charlie.”

He said he threw in the towel last year, selling the bonds for a mere US$259 million, leaving Berkshire with a US$873 million pre-tax loss after taking interest payments into account.