Berkshire News Briefs - 12/15/17

Buffett's About to Get $3 Billion Back From Burger King Owner

Burger King-owner Restaurant Brands International Inc. is scheduled to redeem $3 billion in preferred shares Tuesday from Buffett’s Berkshire Hathaway Inc. The money helped the fast-food chain finance its 2014 purchase of Tim Hortons.

The redemption will take away a lucrative investment for Berkshire and add to Buffett’s arsenal for investments and takeovers. At the end of the third quarter, Buffett’s Omaha, Nebraska-based holding company had a record $109 billion in cash. [...]

After Decades of Hints, Buffett’s Heir May Now Be More Apparent

Keeping the successor’s identity a secret also gives the board more flexibility. Circumstances can change, after all, and probably have during the long period Berkshire’s board has been weighing its options. These days, however, most arrows are pointing toward one man. [...]

Abel has steadily expanded a utility holding company in Iowa into a colossus in the energy industry. It runs several power companies throughout North America and the U.K., interstate natural gas pipelines, and giant wind and solar farms. It’s a big part of Berkshire that stands to get only bigger, Buffett said in May, adding that it’s “hard to imagine a better-run operation.” [...]

Buffett's Fruit of the Loom Tries on Subscription Underwear

Warren Buffett’s Fruit of the Loom is joining the subscription craze.

Guys can now get their boxer briefs from the Berkshire Hathaway Inc.-owned brand through a new subscription service called Fruit to Your Door. Shoppers can buy a six-pack of skivvies, among other products, and have them re-ordered every six months at a 30 percent discount. The program, available for men’s and women’s garments in the U.S., can also be gifted. [...]

What's Geico Really Worth to Berkshire Hathaway?

Few success stories are as important as Geico, which has grown by leaps and bounds since Berkshire acquired it 1996. But as Buffett wrote in his 2010 letter to shareholders, Geico has never been written up to reflect its success and is carried at a mere $1.4 billion premium to its book value.

What would Geico be worth if Berkshire were willing to sell it? We can use a method Buffett laid out in his 2010 letter to shareholders to estimate its value. [...]

Warrren Buffett urged to take old oil tankers out of Adirondacks

An Adirondack conservation group is urging billionaire investor Warren Buffett to remove obsolete oil tankers now being stored indefinitely on a rail line in the Adirondacks.

Adirondack Council Executive Director William Janeway wrote last week to the Nebraska-based investor asking that rail cars owned by subsidiaries of Buffett's sprawling Berkshire Hathaway company be removed from the line.

Owned by Union Tank Car Co. and North American Tank Co., the graffiti-scarred cars are being stored in Warren and Essex counties on a line owned by a Chicago-based company. [...]

Warren Buffett scores a quick $230 million with DaVita deal

UnitedHealth is paying $4.9 billion for a division of DaVita, the kidney dialysis center operator that counts Berkshire as its biggest shareholder, with a 20 percent stake. The one-day paper profit to Berkshire is more than $231 million.

The deal is for DaVita Medical Group, which operates 300 clinics and a handful of outpatient surgical centers in six states. [...] The rest of DaVita will be left to focus on the kidney care business. [...]

Berkshire began investing in DaVita in 2011. The stock has been a favorite of Berkshire portfolio manager Ted Weschler, who has a personal stake in the medical services company of 2.2 million shares, according to FactSet.

But it hasn't always been a slam dunk. At the end of 2011, DaVita shares traded at about $38, rising to $75 by the end of 2014. But they are down 20 percent since then, closing on Tuesday at $60.93. [...]

Duracell Appoints Thom Lachman to CEO of the Duracell Company

Duracell and its parent company Berkshire Hathaway announced today that Thom Lachman has been promoted to CEO of the Duracell Company, Inc., effective January 1, 2018. Roberto (Bobby) Mendez will take over Lachman’s former role, being promoted to President of Duracell North America. [...]

Lachman joined Berkshire Hathaway as a member of Berkshire Hathaway’s Duracell Transition Team on November 1, 2015, and has served as Duracell’s President of North America since March 1, 2016. Before coming to Berkshire Hathaway, Thom gained over 30 years of experience with Procter & Gamble (P&G). His last role as President of P&G Canada was preceded by a role leading the North America integration of the Gillette acquisition. [...]

Chairman of Berkshire Hathaway’s Marmon to Retire in 2018

Frank Ptak, a longtime executive at one of the largest units of Warren Buffett’s Berkshire Hathaway Inc., said in an interview that he plans to retire at the end of 2018.

Mr. Ptak has overseen industrial conglomerate Marmon Holdings Inc. since 2006. He said his preferred successor is Angelo Pantaleo, the current chief executive of Duracell, another Berkshire business.

Earlier Thursday, Duracell said Mr. Pantaleo will become president and chief operating officer of Marmon on Jan. 1. He will also become Duracell’s chairman. [...]

Munich Re to take majority stake in aviation insurer

Munich Reinsurance Co. will hold a majority stake in Global Aerospace Underwriting Managers Ltd. after agreeing to buy an additional 11% of shares in the London-based aviation insurance provider.

Following the purchase from National Indemnity Co., a unit of Berkshire Hathaway Inc., Munich Re will own 51% and National Indemnity will own 49%

Katy Perry drops in on Warren Buffett

Warren Buffett met another celebrity when Katy Perry came to town last week for a concert — or was it the other way around?

Her Instagram account showed the two chatting in Buffett’s office and noted that they talked about cryptocurrency. [...]

Our musicologist, Kevin Coffey, reports that at the concert, Perry told the Omaha crowd that she had had lunch with “your governor, Warren Buffett.” [...]