In a press release late Tuesday, the company said that it has amended its policy regarding share repurchases, now allowing for repurchases of Berkshire stock to be made at the discretion of Buffett and vice chairman Charlie Munger so long as both men "believe that the repurchase price is below Berkshire’s intrinsic value, conservatively determined." [...]
Additionally, the company will not repurchase stock in excess of an amount that would reduce its cash and equivalent holdings to less than $20 billion. [...]
After months of anticipation and fanfare, Dr. Atul Gawande is starting his new job Monday as the CEO of the healthcare venture from Amazon, Berkshire Hathaway and JPMorgan Chase.
The healthcare community at large seems to be both skeptical and hopeful about the venture and Gawande’s appointment. His goal will be to create innovations in a burdened and dangerously large healthcare industry, lowering the cost of care while improving health outcomes. [...]
Warren Buffett’s investing deputy, Todd Combs, helped the billionaire investor in his effort to exit Berkshire Hathaway Inc.’s stake in USG Corp. [...]
Combs’s role in the deal highlights his emergence as a top deputy for Buffett. Combs was selected for an investment role at Berkshire in 2010 and was later joined by Ted Weschler. The pair now oversee $25 billion, according to Berkshire’s annual letter released this year. Combs has increasingly been in the public spotlight with his appointment to JPMorgan Chase & Co.’s board in 2016 and his recent role helping to craft Berkshire’s health-care venture with JPMorgan and Amazon.com Inc. [...]
[...] In the five years Murugappan has been with the company, he's driven a substantial amount of change in how BNSF utilizes technology.
He was part of the team that modernized the systems BNSF uses to inspect its assets. Predicting when the assets need maintenance is vital, and BNSF is using things like big data to make the process more efficient. [...]
U.S. refiners and producers are seeking ways to counter efforts by BNSF Railway Co to limit use of retrofitted oil tank cars following an Iowa derailment last month, Reuters has learned.
The crackdown by the country’s largest railroad, owned by Warren Buffett’s Berkshire Hathaway Inc, could take thousands of tank cars off a key rail line at a time when producers and refiners are scrambling to hire them.
With the last necessary state-level regulatory approvals it needed now in hand, PacifiCorp said it will move forward in building 1,150 MW of wind projects and a high-voltage transmission line in Wyoming.
The utility's goal is to complete the three wind projects in 2020 to realize the full benefit of production tax credits. The new projects will increase the amount of owned and contracted wind capacity on PacifiCorp's system by more than 60% [...]
Warren Buffett's annual donation of stock to five foundations is worth around $3.4 billion this year.
In a news release, Berkshire Hathaway said Buffett converted 11,867 of his Class A shares into around 17.8 million Class B shares to make the contributions.
Based on the schedule established in 2006, when Buffett pledged to give away the bulk of his fortune in the coming decades, the Bill and Melinda Gates Foundation will be getting a large majority of the shares. [...]
Bad weather weighed on results at Warren Buffett's Berkshire Hathaway Inc, as losses from insurance claims tied to Hurricanes Harvey, Irma and Maria and an earthquake in Mexico contributed to a 43 percent drop in third-quarter profit.
Berkshire on Friday said net income fell to $4.07 billion, or $2,473 per Class A share, from $7.2 billion, or $4,379 per share, a year earlier.
Operating profit, which excludes investment and derivative gains and losses and which Buffett says better reflects company performance, fell 29 percent to $3.44 billion, or $2,094 per Class A share, from $4.85 billion, or $2,951 per share.
Berkshire said it incurred $1.95 billion of after-tax underwriting losses attributable to the hurricanes and earthquake. [...]
Berkshire Hathaway's (NYSE:BRK-A)(NYSE:BRK-B) third-quarter operating earnings declined to $3.44 billion, down from $4.85 billion in the year-ago period, due primarily to large insurance underwriting losses from natural disasters. Third-quarter weather events were particularly troublesome for Berkshire Hathaway Reinsurance, which posted a massive $1.3 billion pre-tax underwriting loss in the third quarter.[...]
Insurance -- $395 million net loss
Manufacturing, service, and retailing -- $1.7 billion profit
BNSF railroad hauls it in -- $1 billion profit
Utilities and energy -- $963 million profit
Finance and financial products -- $341 million profit
Pilot was founded in 1958 when Jim Haslam purchased a single gas station for $6,000. It dramatically increased in size when it purchased competitor Flying J out of bankruptcy. Because the bankruptcy proceedings are public, there’s valuable information within the filings made at the time, 2009. A value of $3.3 billion was placed on Pilot and Flying J was to be acquired for $300 million – $500 million in cash plus equity in the new company, valuing it in total at $1.8 billion. Post-merger, the combined entity had revenue in excess of $30 billion and would reasonably have an enterprise value of about $5.1 billion. [...]
The segment of the North American gas station industry has three main competitors: Pilot/Flying J, Love’s, and TravelCenters of America. Pilot/Flying J is the largest with $20 billion in revenue and 750 locations, while family-owned Love’s is not far behind at 430 locations and $16 billion in revenue. Travel Centers of America is the only one of the three that’s publicly traded and has 250 locations and $6 billion in annual revenue. [...]
That still leaves the question of how much Pilot is earning and what it’s worth. Margins are slim in this business – operating income is probably no more than 2% of sales, or maybe $500 million a year in total. Using a multiple of 12x operating income (a discount of about a third to the higher margin consumer gas stations of Couche-Tard and Casey’s) gives an enterprise value of $6 billion. That is roughly consistent with the value placed on the company in the Flying J bankruptcy filings in 2009. Subtracting $2.5 billion in estimated remaining debt would value the equity at about $3.5 billion. [...]
Staff advisers at Oregon's utility regulator threw cold water on PacifiCorp's plan to spend $3.5 billion, one of its biggest upgrades ever, on wind turbines and a new transmission line.
The Public Utility Commission staff say the utility had failed to justify the need for the massive capital investments, whether to meet its capacity, energy or reliability needs. [...]
"There is no need for the proposed resources at all," said the staff recommendation. "PacifiCorp's existing resources are able to meet its resource needs."
That's not a universally held opinion. Some environmentalists support the wind investments, if not the transmission. And PacifiCorp insists it needs it all. But if commissioners agree with its advisory staff, it would be a big setback for the company. [...]
Shaw Industries, the country's biggest carpet maker, is buying a Tennessee-based producer of digital carpet samples and design tools.
Shaw, a subsidiary of Warren Buffett's Berkshire Hathaway, acquired Tricycle Inc. for an undisclosed sum.
Tricycle was founded in Chattanooga in 2002 and works with commercial manufacturers, interior designers and architects to visualize carpet designs and colors digitally. The company says its three-dimensional, color corrected digital images reduce waste by removing the need to produce physical samples. [...]
One of the best resources available to investors are the Berkshire Hathaway shareholder letters. One of my personal favorites is the 1989 letter in which Warren Buffett wrote a piece called – Mistakes of the First Twenty-five Years (A Condensed Version). It’s a great insight into how even the greatest investors can make mistakes. The lesson of course is not to make the same mistake twice. But it seems even Buffett did make the same mistake over and over in buying some of his cigar-butt companies simply because they were cheap. This of course changing when he met Charlie Munger and he coined the phrase, “It’s far better to buy a wonderful company at a fair price than a fair company at a wonderful price.”
Let’s take a look at some of the mistakes that Buffett highlighted from his first 25 years of investing [...]
Despite Berkshire being the sixth-largest company in the S&P 500 by market cap, there are just seven analysts covering the company, according to FactSet. This compares to the No. 5 most valuable company in the index, Amazon, which has 41 analyst ratings. Wall Street doesn't really bother to cover Buffett because of Berkshire's low relative trading volumes as Street research often gets paid from trading commissions. [...]
The analyst established a year-end 2018 price target of $210 for Berkshire Hathaway B shares, representing 17 percent upside from Wednesday's close. [...]
The analyst also mentioned Berkshire utility executive Greg Abel is currently the "most likely" successor to replace Warren Buffett as CEO of the company. [...]
Warren Buffett’s bid to double his stake in Home Capital Group Inc. was rejected by shareholders of the Canadian mortgage lender in a vote Tuesday.
About 89 percent of investors voted against the offer, which would have boosted Berkshire Hathaway Inc.’s stake to 38 percent from about 20 percent. Stockholders including CIBC Asset Management had objected to the deal, arguing it would dilute the stock by selling shares to Berkshire at an almost 30 percent discount. [...]
A long-term view of electrical generation -- not politics or fads -- drives Rocky Mountain Power's decision to invest $3.5 billion in transmission capability, wind power and other infrastructure in Wyoming by 2020, company officials said Friday. [...]
The Salt Lake City-based Rocky Mountain Power is a part of the Portland, Ore.-based PacifiCorp, a subsidiary of Berkshire Hathaway. Rocky Mountain Power has nearly 1.1 million customers in Wyoming, Utah and Idaho [...]
Rocky Mountain Power's energy-generating capacity is about 55 percent coal, 25 percent natural gas, 10 percent hydroelectric, and 10 percent wind and other sources [...]
[...] Because of the limited presence of national primary carriers in the homeowners market in Florida, we think the biggest industry impact of large privately insured losses would probably be in reinsurance. Reinsurers have faced weak pricing in recent years due to an overabundance of capital and the rise of the catastrophe bond market. In our view, major catastrophe losses could be a catalyst for an industry shakeup and a return to more normalized pricing conditions. For disciplined and well-capitalized reinsurers such as Berkshire Hathaway, the positive impact on pricing should provide a material long-term offset to the near-term losses.
MindWare, a division of Oriental Trading Co. of La Vista, has acquired Peaceable Kingdom, a company that develops cooperative games and related products, for an undisclosed amount.
Peaceable Kingdom, based in Berkeley, California, was founded in 1983 by the family of Clement Hurd, illustrator of the “Good Night Moon” children’s book. [...]
The company makes games with the goal to “inspire cooperation and cultivate kindness,” including Bunny Bedtime, Mole Rats in Space, Friends and Neighbors, You Guessed It, Say the Word and What’s It? [...]
Howard Buffett, son of billionaire investor Warren Buffett, is adding to his job titles that of interim sheriff of Macon County in central Illinois.
Macon County Sheriff Thomas Schneider said Friday that he is retiring early ahead of an election next fall for his replacement. He has chosen Buffett, whose charitable foundation has contributed more than $55 million in the region over the past two decades, to serve in the meantime.
Howard Buffett has been a Macon County undersheriff since September 2014 and has completed more than 3,300 hours of patrol and training. [...]
The Berkshire Hathaway CEO joined pop music legend Stevie Wonder for a duet at a star-studded gala honoring Forbes magazine at Manhattan's Chelsea Piers on Tuesday.
Wonder and Buffett sang a duet of the classic hit The Glory of Love, a single written by Billy Hill and first recorded by Benny Goodman in 1936. [...]
The 2nd Quarter 13-F statement is out, showing what stocks Berkshire Hathaway bought and sold last quarter. Dataroma has the best format for visualizing the changes.
Billionaire investor Warren Buffett built a new position in consumer finance company Synchrony Financial and boosted his holdings of Bank of New York Mellon by more than 50% in the second quarter of 2017, according to a regulatory filing Monday from Berkshire Hathaway.
Buffett's financial moves are closely watched by Wall Street. In the April-thru-June quarter, Buffett's Berkshire Hathaway also dumped the rest of its stake in General Electric (GE), selling the rest of its roughly 10.6 million share position. [...]
It’s a milestone Warren Buffett probably wishes he weren’t approaching.
Berkshire Hathaway Inc., the conglomerate he’s run for more than five decades, reported Friday that it held just shy of $100 billion in cash at the end of the second quarter.
While that figure highlights the staggering money-making ability of the businesses he’s collected over the years, it’s also a burden. Because Berkshire doesn’t pay a dividend and rarely buys back its own stock, Buffett is on the hook to find ways to invest those funds.
Bankrupt Texas utility Energy Future Holdings will abandon a deal to sell power transmission company Oncor to Warren Buffett's Berkshire Hathaway for $9 billion and will accept a $9.45 billion bid for Oncor by Sempra Energy instead, people familiar with the matter said.
The development represents a rare blow for Buffett, who avoids bidding wars for companies and had swooped in two months ago to buy Oncor after two previous attempts by Energy Future to sell it were blocked by Texas regulators. [...]
Warren Buffett got oohs and aahs when people thought he’d bagged a $270 million breakup fee after his Berkshire Hathaway Energy was outbid for Oncor by Sempra Energy, which won the company with a $9.45 billion offer. [...]
But, it seems, Berkshire didn’t get far enough along in its bid for Oncor to qualify for the fee.
Even if Berkshire could have claimed the full $270 million, some of that would have been offset by the costs — think lawyers, accountants, analysts, bankers — incurred by pursuing Oncor in the first place. [...]
Reading headlines such as, "Buffett's Latest Dealmaking Flop," and "Buffett Encounters Rare Miss," might make some Berkshire investors wonder if the Oracle of Omaha has lost his touch. Adding insult to injury, the deal fell through too quickly for Berkshire to qualify for its $270 million breakup fee, so Buffett and Berkshire will walk away with nothing. [...]
While Berkshire shareholders (and, I'm sure, Buffett himself) may be disappointed, they should take comfort in Berkshire sticking to its principle of not getting involved in a bidding war. Bending on that principle this time could cause potential acquirees to negotiate harder in the future -- and those could be even larger deals. One wonders if 2015's $32 billion acquisition of Precision Castparts -- a deal 3.5 times bigger than Oncor -- would have happened on attractive terms had Buffett not stuck to his "one offer" policy.
As longtime Berkshire shareholder Steve Walman said in a recent Bloomberg article, "the minute he starts negotiating, he becomes everyone's favorite stalking horse and ends up as 'bid 'em up Buffett.'" Since Berkshire is built on acquisitions, cultivating a reputation for bending on price is not something Buffett wants to do. As he himself once said, "The smartest side to take in a bidding war is the losing side." [...]
Warren Buffett has called global warming a “major problem” and put his company’s money where his mouth is, spending billions to develop solar and wind power. Yet he’s no hero to some renewable energy proponents. Their beef: They say the utility arm of Berkshire Hathaway Inc., his conglomerate, has been trying to undermine an almost 40-year-old law intended in part to promote the growth of cleaner energy. Berkshire, they say, is effectively stifling solar projects to protect utilities it owns, such as PacifiCorp, based in Portland, Ore. [...]
Berkshire Hathaway Energy says it’s not so simple. The company, which owns several utilities using conventional and renewable power sources, is the second-largest owner of clean-energy assets in the U.S. But along with other utilities, it argues that the law is outdated, often raises costs for its customers, and forces utilities to buy more electricity than needed.
The law is called the Public Utility Regulatory Policies Act, or Purpa. Congress enacted it after the 1970s OPEC oil embargo to draw new players into the utility-dominated business of generating power. It required some utilities to buy power from certain power providers if doing so was less expensive than building new plants themselves. The idea was to boost the then-emerging natural gas industry—and perhaps spur renewables including solar.
The act worked—too well, from the standpoint of the utilities. As solar panel prices plunged in recent years, developers deluged utilities with projects to sell them power. Utilities complain the law is producing a surplus of power. Moreover, utilities say the contracts with developers, whose terms are generally set by state utilities regulators, often lock them in for years at high prices that don’t necessarily reflect the current market. [...]
Alternative mortgage lender Home Capital Group Inc. fielded acquisition offers from two different private equity firms in June — one of which raised its bid even after the Toronto company decided to take Warren Buffett’s white-knight deal, according to a proxy circular released on Friday.
The two firms were not named in the document released ahead of a special meeting of shareholders next month, but sources familiar with the process say Home Capital’s two suitors were Onex Corp. and Brookfield Business Partners. [...]
After some consideration, Home Capital’s board rejected the sweetened offer, it said.
“The Board determined that the revised acquisition proposal was inferior to the (Berkshire) Transaction and that the Transaction was in the best interests of the Corporation and continued to provide Shareholders with the best combination of transaction certainty and the potential for enhanced Shareholder value, while meeting the need for strong sponsorship and lower cost standby debt financing,” it said. [...]
(Larsen & Toubro is based in Mumbai, India. Rs174 crore is equivalent to around $27.2 million USD.)
Engineering major Larsen & Toubro Ltd (L&T) on Wednesday said it has agreed to sell its entire stake in its unlisted unit L&T Cutting Tools Ltd to IMC International Metalworking Companies BV, owned by Berkshire Hathaway Inc., for Rs174 crore.
L&T Cutting Tools, incorporated in 1952, manufactures fabricated metal products. [...]
It's been 14 years since California officials first approved the Black Rock power plant, which would have tapped a powerful geothermal reservoir along the shore of the Salton Sea and generated enough climate-friendly electricity to power about 200,000 homes. [...]
CalEnergy, which is owned by Warren Buffett's Berkshire Hathaway Energy, asked the California Energy Commission earlier this summer to terminate the license for Black Rock. The company had requested and received extensions of the construction start deadline in 2007, 2011 and 2014, but this time decided to move on rather than pay a $27,678 annual compliance fee that would have been due at the end of June. [...]
"Berkshire Hathaway is big. They've got a lot of wind, they've got solar, they've got other areas. (Geothermal is) a complicated thing to do," Kaspereit said.
On what he looks for in businesses: "I want a very valuable castle, with a duke in charge of it who is very honest and hardworking and able. Then I want a moat around that castle."
On what he looks for in managers: "We look for three things: intelligence, energy, and integrity. If they don’t have the latter, then you should hope they don’t have the first two either. If someone doesn’t have integrity, then you want him to be dumb and lazy."
On why he doesn’t invest in gold: "You could take all the gold that’s ever been mined, and it would fill a cube 68 feet in each direction. For what that’s worth at current gold prices, you could buy all—not some—of the farmland in the U.S. Plus, you could buy 16 Exxon Mobils, plus have $1 trillion of walking-around money. Or you could have a big cube of metal. Which would you take? Which is going to produce more value?" [...]
The billionaire investor and the crooner serenaded this year’s class of Pro Football Hall of Fame enshrinees with Anka’s song, “My Way,” at the Gold Jacket Dinner Friday night.
Anka sang a few lines of the song he wrote for Frank Sinatra before pausing to bring his friend, Buffett, to the Memorial Civic Center stage. [...]
Berkshire said Goodyear claimed to have in 2008 exhausted a policy from another insurer for the asbestos claims, but waited until November 2015 to seek reimbursement from Berkshire for "several millions of dollars" under an "excess" policy.
It also said Goodyear had never asked for help in defending against the claims prior to November 2015.
About 62,000 claims are pending against Goodyear in states including Florida, Maryland, New York, Pennsylvania and Texas over alleged exposure to asbestos-containing products as floor tiles, furnace hoses, gaskets and heat shields, Berkshire said.
Precision automotive molder Prism Plastics Inc. has been sold to a subsidiary of Marmon Engineered Components Co., according to an announcement from Altus Capital Partners, the investment firm that had owned Chesterfield, Mich.-headquartered Prism along with its founders since June 2014.
Marmon is an affiliate of Berkshire Hathaway Inc., the publicly traded conglomerate headed by Warren Buffett.
Under Altus ownership Prism has undertaken several growth initiatives, including the June 2016 acquisition of Tech Molded Plastics Inc. of Meadville, Pa. That move doubled Prism’s size and added in-house toolmaking capabilities. [...]
PacifiCorp, a division of Berkshire Hathaway Energy, issued a three-year, $3.5 billion plan for its renewable energy system from Wyoming to California.
The six-state plan will add 900 megawatts of capacity by upgrading generators with larger blades and new technology, build a 140-mile-long power line in Wyoming and add 1,100 megawatts of new wind projects. [...]
The plan includes adding another 1,000 megawatts of solar generators in the states by 2036. [...]
BH Media Group, the newspaper division of Warren Buffett’s Berkshire Hathaway Inc., announced yesterday that it was cutting 289 jobs at its newspapers across the country yesterday. The cuts included the elimination of 108 jobs that currently are vacant.
The reasons for the job losses are depressingly familiar in the newspaper industry: loss of circulation and advertising revenue, lagging revenue from the digital side of the business.
Terry Kroeger, president and CEO of BH Media, sent a memo to employees yesterday. "While more readers than ever turn to our digital products, our digital revenue is not growing fast enough yet to offset print revenue losses from both advertising and circulation," he wrote. "Therefore, we need to cut our expenses." [...]
A key requirement for a company to earn high returns on capital over a long period of time is to have a competitive advantage, commonly referred to as a 'moat'. Mr Buffett addresses the issue of competition in his 1993 letter where he talks about the Nebraska Furniture Mart, a businesses he acquired from Rose Blumkin [aka Mrs B.] in 1983. Under the motto "sell cheap and tell the truth," she worked in the business until age 103.
Nebraska Furniture Mart is a pretty simple business, it sells furniture, flooring and home appliances. It's easy to understand and it's unlikely to be subject to a lot of change. In ten years time it will still be selling furniture. [...]
How much would you pay for a $298 billion perpetual bond with an 8.5% coupon and $66 billion of additional cash? While this seems like an odd question, I would argue it is the one you're trying to answer when choosing to invest, or not invest, in Berkshire Hathaway. No, Berkshire common stock is not a bond; however, as I will try to demonstrate, while Berkshire's stated GAAP earnings are volatile, its underlying return on shareholders' equity is highly consistent, not entirely dissimilar to a bond coupon. This analysis will disaggregate Berkshire's constituent assets and liabilities in its various business segments and the earnings attributable to those segments. Doing so will allow us to uncover what I will term a "steady-state" return on equity. With that return in hand, we can then determine the "yield" and subsequent value to assign our "bond."
[Dwayne] Johnson, who works in a steel factory in Huntington, West Virginia, was sitting on his couch Saturday afternoon when Buffett called to tell him that, with 31 out of 32 correct predictions in his March Madness bracket, he'd be winning $100,000 of the billionaire's money. (If Johnson had correctly called South Carolina's victory over Marquette, he would've received a cool $1 million.) [...]
Johnson says the $105,000 in winnings - which include an additional $5,000 from his employer, Precision Castparts - will help him pay off credit card debt and buy a new car. He also plans to save six months' worth of expenses in case he loses his job, something he says he has worried about in recent months after widespread layoffs at the steel mill where he has worked for nearly 10 years. He makes $21.13 an hour as a welder at the company, which Buffett's Berkshire Hathaway purchased two years ago for nearly $32 billion. [...]
People in China are coming face to face with Warren Buffett's love for Cherry Coke.
A cartoon rendering of the billionaire investor is appearing on special edition Cherry Coke cans all over the world's most populous nation.
Buffett is helping Coke launch the flavored soda in China, a sugary drink the 86-year-old claims is his secret to staying young. [...]
[Berkshire Hathaway] has been collecting roughly $225 million a year (or $8 a second) in interest from his Dow Chemical stake since 2009. That year, Buffett provided Dow with $3 billion to help finance its purchase of chemical maker Rohm and Haas. As part of the agreement, the industrials giant gave the investor preferred stock and slapped on a hefty 8.5% annual payment on top of it.
But the contract came with a back door for Dow. Starting in April 2014, should shares of Dow Chemical close above $53.72 for 20 days in any consecutive 30-day trading period, Dow can convert Buffett’s preferred shares into common stock—canceling the Oracle’s $8-a-second payout. Each of Dow’s common shares pay a mere 3.4% annual regular dividend, so it’s of little surprise that Dow Chemical has indicated that it fully intends to convert Buffett’s stake should the conditions be met. [...]
Ajit Jain, one of Warren Buffett’s top managers at Berkshire Hathaway Inc., has a message for the staff that he oversees at Gen Re: It’s time for their business to get much leaner and less bureaucratic.
After taking charge of the reinsurer this year and installing a longtime deputy to lead the operation, Jain sent a memo to employees detailing five areas, including compensation and sales channels, where changes should be made. He also called for increasing business unit autonomy, accepting modifications on the terms of some risk-transfer deals and reducing complexity. [...]
The Iowa Utilities Board has given MidAmerican Energy the green light for the utility's plans for a $3.6 billion wind energy investment, the largest renewable energy project in the state.
The state board on Friday gave final approval for the utility's Wind XI farm.
The project -- first announced in April -- is part of Des Moines-based MidAmerican's goal to reach 100 percent renewable energy for Iowa customers. [...]
Starting Sept. 12, BNSF Railway Co. will offer intermodal customers a new service to move freight between the Pacific Northwest and Texas, the Class I announced yesterday.
Under the new service, shippers who move commodities and consumer goods between Portland, Ore., or Seattle and Dallas/Fort Worth will be able to cut transit times by up to two days when compared to rail transit time options currently in the marketplace, BNSF officials said in a press release. [...]
NV Energy and PacifiCorp returned nearly $95,000 to generation customers after FERC revoked market-based rate authority for Berkshire Hathaway Energy affiliates in four neighboring Western balancing authority areas and imposed cost-based rates. [...]
The commission restricted Berkshire’s market-based rate authority in June after ruling that the company’s affiliates failed to disprove that they collectively exercise horizontal market power in the PacifiCorp East, PacifiCorp West, Idaho Power and NorthWestern balancing areas [...]
Warren Buffett's Berkshire Hathaway took its first step toward becoming a conglomerate back in 1967 by stepping from textiles into insurance, which would become its lifeblood. Nearly fifty years later, it's evolved again.
The $358 billion company's steady foray into energy, railways and manufacturing (among other sectors) has radically changed its earnings profile over the past decade. As a result, once-core insurance divisions such as Geico have become a much smaller part of the overall business. In fact, Berkshire's insurance arm is expected to contribute just 25 percent of its total 2016 pre-tax operating earnings, less than half the 57 percent that it accounted for in 2006. [...]
Tuesday, Aug. 30, is Warren Buffett's 86th birthday. Each year, I celebrate the Babe Ruth of Investing's birthday by adding another reason we love our hero. [...]
MGM Resorts and Wynn Resorts have said that paying $102.6 million to leave the utility and find their own energy is better for their businesses than staying with NV Energy. Las Vegas Sands stopped short of committing $23.9 million to leave NV Energy this year but is leaving its options open. As these resorts collectively make up 7% of the demand in NV Energy's territory, this is a big deal for the utility.
Warren Buffett is about to get back the $8 billion — plus a little extra — that his Berkshire Hathaway Inc. invested in Kraft Heinz Co. [...]
The 2013 deal allowed the foodmaker to pay a premium to redeem the preferred shares after three years, a period that expires next week. Mr. Buffett has said Berkshire will get about $8.3 billion, replenishing its coffers after the purchase of manufacturer Precision Castparts Corp. in January, one of his biggest buyouts ever.
Today though if you look at Berkshire's 6 largest positions, you see something very different. Gone are the concentrated bets that are likely to double several times in the next decade. Instead, you find a very conservative looking portfolio (although still concentrated) that offers a significant amount of yield. [...]
Berkshire will receive over $2.7 billion in dividends from these [six] positions [KHC, WFC, KO, IBM, AXP, PSX] in 2016. That is basically the size of the entire Berkshire portfolio back when Buffett was buying Coca-Cola in the late 1990s.
Warren Buffett never bought AT&T shares for Berkshire, nor did the company's other stock pickers. Instead, the AT&T stake was acquired through an acquisition.
In 2011, Berkshire began to accumulate a position in DirecTV, which it added to several times afterwards. [...] AT&T's acquisition paid shareholders $95 per share.
However, only $28.50 of that amount was in cash, with the remainder payable in AT&T stock, which is where Berkshire's AT&T stake originated. After the sale was complete, Berkshire received 59.32 million shares of AT&T during the third quarter of 2015, but they didn't stay in the portfolio for long. Berkshire unloaded 12.7 million of them during the fourth quarter, and sold the rest during the first quarter of 2016.
Richline Group, a jewelry subsidiary owned by Warren Buffett’s Berkshire Hathaway, continued its recent string of acquisitions with the purchase of Viawear, a provider of wearable technology for jewelry brands.
Viawear has developed bracelets that filter mobile notifications so wearers receive important alerts without having to check if they missed something. [...]
The Lubrizol Corp. has announced that Eric R. Schnur, currently executive vice president and chief operating officer, has been named president, effective immediately, and will become chairman and chief executive officer on January 2, 2017. James L. Hambrick, the current chairman, president and chief executive officer, having fulfilled his commitment to remain in those roles for five years following Berkshire Hathaway’s acquisition of Lubrizol in 2011, has decided to complete his 38-year Lubrizol career. [...]
A two part interview with PacifiCorp execuitve Stefan Bird (PacifiCorp being the Berkshire Hathaway Energy company serving the Pacific Northwest):
"Renewables are definitely a big part of our story. PacifiCorp is the second largest owner of utility- owned wind assets in the country, number two to our sister utility, MidAmerican Energy [...]
We’ve got about 2000 megawatts of renewables out of our total portfolio of 11,000 megawatts. We have a very large hydroelectric fleet and that contributes to our emission-free supply. There are a number of changes that have been pretty exciting in the last year or so as we collaborate more effectively with our neighbors. The Western grid is all physically interconnected, but we frankly don’t use it as efficiently and effectively as we could." [...]
"Being part by a large private corporation with very strong financial capabilities gives us some unique advantages, from a cost of capital standpoint and our ability to utilize federal tax credits. That allows us to pass those benefits through to our customers in a unique way. We can focus on the long-term, we’re not worried about quarterly results and we really want to make decisions that make sense for our customers to give them a sustainable value proposition for the long haul."
The annual charity auction for a private lunch with billionaire investor Warren Buffett is underway.
The top bid to dine with the chairman of the conglomerate Berkshire Hathaway Inc was $200,100 at 12 p.m. EDT on Monday, but will likely surge by the time the auction on eBay ends on Friday night.
Winning bids have reached seven figures every year since 2008, with the record $3,456,789 offer submitted anonymously in 2012. Last year's winner paid $2,345,678.
Auction proceeds go to Glide, a charity in San Francisco's Tenderloin district that provides food, health care and other services to people who are homeless, poor or struggling with substance abuse. Buffett has raised about $20.2 million in 16 auctions for Glide.
I never know what markets are going to do. There's never been a time in my life when I know what markets are going to do over a long period of time. They're gonna go up. But in terms of what's going to happen in a day or a week or a month or a year, even, I never felt that I knew it then and I never felt it was important. I will say that in ten or 20 or 30 years, I think stocks will be a lot higher than they are now. [...]
Duracell is no longer part of Procter & Gamble or one of its storied billion-dollar brands after the closing of the Cincinnati-based company's sale of the iconic battery brand.
P&G has closed on its previously announced sale of Duracell to Warren Buffett's Berkshire Hathaway. P&G invested $1.8 billion into the outgoing brand as it prepared to exit the business unit. In exchange, Berkshire Hathaway tendered 52 million P&G shares worth more than $4 billion back to the consumer products giant. [...]
California has more renewable energy than it can handle.
Elsewhere in the United States, states with extra power hand it off to neighbors when they need it. That's not happening in the West, where cooperation among electrical grids has historically been an issue. The result: Individual providers can find themselves shutting down their extra power rather than sending it elsewhere. [...]
California and utilities owned by Warren Buffett's Berkshire Hathaway Inc., including PacifiCorp and NV Energy Inc., are now on a mission to end that thinking as quickly as possible.
The energy unit of Warren Buffett‘s Berkshire Hathaway on Monday said Gregory Abel, its chairman and chief executive, saw his compensation jump 48% last year to nearly $41 million, reflecting a large incentive award. [...]
Abel, 53, has led Berkshire Hathaway Energy since 2008, and expanded it through a series of acquisitions. Many investors and analysts believe Abel, who has taken on a greater public role at Berkshire, is a top candidate to eventually replace Buffett as Berkshire Hathaway’s chief executive.
Rail freight volumes for Union Pacific and BNSF Railway have continued to slump so far in 2016, after a disappointing 2015 that has led to job furloughs and sliced capital spending. [...]
At Texas-based BNSF, owned by Omaha’s Berkshire Hathaway, volumes are down 3 percent in the same period. Top decliners have been metallic ores, coal and crude oil. [...]
Credit ratings agency Standard & Poor's is formally acknowledging what Warren Buffett watchers have known for years: Berkshire Hathaway has transformed itself from an insurance holding company to a full-fledged corporate conglomerate. [...]
Word of the shift accompanies S&P's announcement that it is no longer considering a possible one- or two-notch downgrade of Berkshire's credit rating.
Warren Buffett just announced a crazy new March Madness contest for Berkshire employees.
Speaking with CNBC's Becky Quick on Monday morning, Buffett announced that Berkshire Hathaway employees would be able to win $1 million a year for life if they could pick a perfect NCAA Tournament bracket up until the Sweet 16. [...]
“If you want to guarantee yourself a lifetime of misery, be sure to marry someone with the intent of changing their behavior.”
Here, Buffett is actually using a quote from his business partner Charlie Munger to demonstrate that he isn’t a micro-manager when it comes to subordinates. He puts capable managers in charge of his businesses and stays out of their way.
Berkshire Hathaway Energy on Monday joined a dozen major U.S. businesses at the White House in calling for robust action on global warming. [...]
BH Energy has invested more than $15 billion in renewable energy and is targeting another $15 billion in investments, Greg Abel, chairman, president and chief executive officer, said in a press release.
“Joining these other U.S. businesses is one more way we can demonstrate our commitment to lead on climate action,” said Abel, who is seen as a possible successor to Buffett, who turns 85 next month.
Bill Fehrman, CEO of MidAmerican Energy, said Monday the company could get up to 57 percent of its energy from wind with its latest renewable energy project.
And while wind's growing presence in MidAmerican's portfolio is encouraging, so is news that the Des Moines-based utility is looking to invest in solar projects in Iowa, with community solar gardens and utility-sized solar leading the possible options. [...]
He talked with the Register as the utility's parent, Berkshire Hathaway Energy, joined a dozen other national companies in launching the American Business Act on Climate Pledge at the White House.
PacifiCorp, part of Warren Buffett's Berkshire Hathaway Inc., serves 1.8 million customers in six states through its Pacific Power and Rocky Mountain Power utilities, and is planning to meet 86% of new demand across the next decade through demand side management. [...]
That means the utility won't need to construct another major power plant until 2028, and along the way will either shutter 10 older, inefficient coal units, or convert them to natural gas.
The Heinz score rivals anything ever achieved in the private-equity industry. It also demonstrates that Buffett, who is celebrating his 50th year at the helm of Berkshire this year, is still going strong ahead of his 85th birthday in August. Berkshire is his baby, and the company is better than ever despite the lackluster performance of its big equity portfolio [...]
“I’m scratching my head about Berkshire,” says Jay Gelb, a Barclays analyst. “The earnings power is stronger than ever, the company has done a series of attractive acquisitions, and it just closed on Kraft. None of that is reflected in Berkshire’s valuation.” [...]
The three-man British Open playoff was a win-win-win for NetJets. Zach Johnson, Louis Oosthuizen and Marc Leishman, the three men in Monday’s four-hole playoff, each have sponsorship agreements with the luxury aviation unit at Warren Buffett’s Berkshire Hathaway.
All three wore shirts with the company’s logo throughout the 18-hole final round at St. Andrews in Scotland, then the playoff, which Johnson won. Monday’s final round telecast on ESPN generated about $6.5 million in media exposure for NetJets [...]
The European Commission said on Thursday it had approved Berkshire Hathaway's purchase of Procter & Gamble's Duracell battery unit.
The Commission said in a statement the proposed acquisition would not raise competition concerns given the absence of horizontal overlaps and the existence of numerous competitors in the vertically related market where the parties are active. [...]
Austbrokers, which takes up to 25 per cent of the first year's premium as a commission, is in trouble.
Berkshire intends to use its established position and substantial resources to sell commercial insurance online with a new initiative called Berkshire Hathaway Direct, cutting out brokers once and for all. Berkshire will focus on small to mid-size businesses – Austbrokers' bread and butter.
Until now, the company was protected by the complexity of insuring a business compared with an individual or car. Berkshire's decision to focus on internet-based, direct-to-customer commercial insurance suggests technology is now at a point where policies can be priced and written entirely online.
On Monday, Proto Enterprises, a company owned by Italian real estate agent Alessandro Proto and based in London, claimed that the company had purchased St Thomas island along with Buffett, one of the world's richest men, for 15 million euros. The company added there were plans to develop real estate on the island, which is not far from Athens.
However, Buffett denied the claim on Tuesday, telling the Omaha World Herald newspaper, which is owned by Buffett's company, Berkshire Hathaway, by email that: "Until the reports started coming out, I had never heard of the guy who is making the claims about the Greek Island." [...]
On Wednesday, after the company gave conflicting accounts to the media, Newsweek received an email from the same address, claiming to be Alessandro Proto himself, admitting that the story had been fabricated and saying that the company's claims had been a "sociological experiment", orchestrated by him. Proto predicted a meeting between himself and Buffett, and an economic bounce for Greece as a result of his actions.
The website of Berkshire Hathaway is famously crude. You might even call it ugly. But look at the HTML code of this spartan “WEB page” and you’ll see that the best term for it is simply old school. It is a blast from the internet’s past. [...]
Maybe it’s a conscious choice. Berkshire Hathaway and chairman Warren Buffet’s down-home reputation gives shareholders confidence through nostalgia for simpler times, when investors really knew their companies and stuck with them. The website brings us back to a time when people really knew their websites, when they wrote HTML by hand, character-by-character. That is to say, this ’90s site is completely on-brand.
At one time, Berkshire made linings for men’s suits. Now, its various 100%-owned subsidiaries make cowboy boots, floor enamel and Ginsu knives; sell ear-piercing tools, diamond rings and encyclopedias; rent topiaries, candelabras and refrigerated trailers; provide insulated bags for pizza-delivery men, uniforms for police officers and shoulder pads for football players… and much, much, much more.
If Berkshire’s wholly-owned companies were independent, nine of them would be among the Fortune 500.
Warren Buffett was forced to defend his association with 3G Capital from the beginning of the ritual Q&A session at the Berkshire Hathaway Annual Meeting last Saturday, as a shareholder said that "he cannot make a moral case" for the Brazilian investment firm's aggressive cost-cutting programs at acquired companies. Given that Berkshire Hathaway's partnership with 3G Capital is more likely to expand than shrink over the next decade, Berkshire shareholders ought to understand its nature. In fact, 3G's methods are not inconsistent with Mr. Buffett's approach to business, which is, well, all business.
Burlington Northern Santa Fe Corp. is extending its operating improvement plans as the railroad seeks to recover from “significant service-related challenges” that the carrier and its customers have struggled with over the past year.
Berkshire Hathaway Inc., the railroad’s parent, said BNSF has seen its network operate more smoothly lately as it has boosted capacity by expanding lines, adding locomotives and bringing in new hires. “We plan to continue our capital expansion and operational improvement initiatives in 2015 in order to meet customer demand and improve and maintain service levels,” the Berkshire said in its first-quarter 10-Q filing late Friday.
BNSF Railway Co., owned by Warren Buffett’s Berkshire Hathaway Inc., will be among the first companies to operate a commercial drone over hundreds of miles in a U.S. research program to test the safety of pilot-less flights.
A camera-equipped drone will fly as far as 400 miles (640 kilometers) along tracks in rural areas to inspect rails, BNSF said. The Federal Aviation Administration also chose CNN and Precision Hawk USA Inc. to make flights beyond the visual line of sight of an operator in unpopulated areas, a practice that is currently banned.
The use of drones “increases the frequency of inspection. We have some very remote areas,” Gary Grissum, BNSF’s assistant vice president of telecommunications, said in an interview. “We’re looking to be able to detect very small defaults in the rail.”
A tiny central North Dakota town has been evacuated after the derailment of an oil train.
The incident displaced residents of Heimdal, sheriff's officials told local media. The accident involved a BNSF Railway train with 109 cars, five of which were burning. Six to seven cars derailed and the cause of the event is unknown, according to officials.
Investor Warren Buffett again defended Berkshire Hathaway's manufactured home unit Monday and praised some of his company's biggest investments.
Buffett discussed Clayton Homes' lending practices, interest rates, Berkshire's investments and other topics during an interview on CNBC Monday. Over the weekend, he answered questions in front of more than 40,000 people at Berkshire Hathaway's annual meeting.[...]
A subsidiary of Warren Buffett’s Berkshire Hathaway Inc. will announce Thursday that it plans to build the Grande Prairie Wind Farm, which would be Nebraska’s largest wind-powered electric generating plant and increase the state’s wind energy capacity by nearly 50 percent.
BHE Renewables, a subsidiary of Berkshire Hathaway Energy, purchased Grande Prairie from Geronimo Energy of Edina, Minnesota, which had acquired it from a Chicago developer in 2013. The other companies arranged leases, got permits and completed other development steps.
Construction is to start this summer on the 400-megawatt project, located about 12 miles northeast of O’Neill, and be completed in 2016, adding to the state’s existing 810-megawatt wind energy capacity.
Buffett’s Berkshire Hathaway Energy disclosed that it recently acquired a site for solar generation development in MISO’s central region. The “site” consists of 74 individual “locations” not to exceed 1 MW each, according to the company’s quarterly property acquisition report. [...]
The company did not disclose exactly where the site is located. The company is not ready to make an announcement on the project, spokesman David Caris said. MISO is a new locale for the company’s solar portfolio. [...]
Berkshire Hathaway’s planned solar expansion in MISO’s coal-dependent central region — which includes Indiana, Michigan, Wisconsin and parts of Illinois — appears designed to take advantage of increased demand for renewables as a result of federal environmental regulations.
Berkshire Hathaway utility PacifiCorp will procure renewable generation from a 7MW solar installation in Oregon by the end of 2015. [...]
PacifiCorp expects that the plant will supply power to about 1,000 residents in the town of Bly, Oregon. The company serves 1.8mn customers across Utah, Oregon, Wyoming, Washington, Idaho and parts of northern California.
The 7MW plant will be built on a former 40-acre lumber mill site, with 20,000 solar panels, and will become PacifiCorp's largest operational solar facility in Oregon.
Forest River will break ground this week on a new manufacturing facility in Michigan.
The Elkhart-based company announced plans in January to build three 100,000-square-foot facilities in White Pigeon and create 396 jobs in the next three years. [...]
Forest River is investing more than $7 million in the project and is receiving substantial incentives from state and local governments.
Nebraska Furniture Mart executives told hundreds of local dignitaries, employees and others attending a ribbon-cutting Thursday that the store is finally ready to take on the throngs of shoppers it was built for. [...]
Blumkin said the Omaha-based retailer, a unit of billionaire Warren Buffett’s Berkshire Hathaway, had several locations to choose from, but decided on the spot along the Sam Rayburn Tollway and Plano Parkway partly because of the cooperation from local entities. It has its own exit from the tollway, for example.
John Noel, president of Berkshire Hathaway Travel Protection (BHTP) and founder of Travel Guard International, MyAssist and Insure America, today is moving to an executive advisory role after being diagnosed with early stages of Lewy Body Disease.
He will be succeeded as president by Dean Sivley, who had served as president of Travel Guard–Americas and was chief e-business officer of Travel Guard’s global operations after Noel left that company in 2009, three years after selling it to AIG. Sivley most recently served as CEO of the car service GroundLink.
Dairy Queen, according to a letter written by one of its executives that was released by an advocacy group, is pulling soft drinks from its kids menu. The letter, which is dated May 11, says the company along with its franchisees had voted to make the switch. The ice cream chain said the change would take place as soon as September 1 because that’s how long it would take the company to change its restaurant menu boards. After that, only water and milk will be the only beverages on the kid’s menu at Dairy Queen restaurants.
Billionaire investor Warren Buffett has once again agreed to have lunch with the winner of an upcoming auction to benefit a San Francisco charity.
The 16th annual auction to benefit Glide, which provides food and services to the poor and homeless, will be held on eBay from May 31 to June 5, the charity said.
Past auctions have raised about $17.8m, including a record $3,456,789 from an anonymous bidder in 2012. Last year's winner, Andy Chua of Singapore, bid $2,166,766.
Billionaire investor Warren Buffett is famous for his frugality, living in the same Omaha home he purchased in 1958 for $31,500, yet his neighbors across the street have a slightly higher, and slightly tongue-in-cheek, asking price in mind for their five-bedroom house.
Homeowner Phil Huston says that though the property has been recently valued at $866,000, he and his wife are asking for 10 Class A shares of the company their famed neighbor has helmed for half a century, Berkshire Hathaway. While at first glance, this may not seem like a lot, Warren Buffett has famously never split Berkshire Hathaway’s stock, as Yahoo Homes points out. This means that each individual share of the conglomerate currently sells for $215,800 as of closing Friday, making the asking price of Huston’s home $2.158 million.
Warren Buffett is smiling about Coke again, and singing about it.
The billionaire investor made a special guest appearance at Coca-Cola’s annual shareholder meeting on Wednesday. Buffett was introduced with a video of him singing, ukulele in hand, “I’d like to Teach the World to Sing” from Coke’s classic hilltop commercials.
This is an excerpt from the book, "Berkshire Beyond Buffett: The Enduring Value of Values."
The companies owned by Berkshire Hathaway, the huge conglomerate that Warren Buffett built, follow their leader in embracing corporate social responsibility, stewardship and sustainability. But the breadth and scale of the sprawling conglomerate can hide both the commitments and periodic problems. [...] While Berkshire has won plaudits for good corporate citizenship, critics complain about the absence of conglomerate-wide reporting on items such as social responsibility and sustainability. Many Berkshire subsidiaries — including Brooks, Johns Manville, Lubrizol and Shaw — are in the vanguard of such corporate stewardship. They join elite global companies in the practice of issuing formal responsibility and sustainability statements and audited reports on the corporate treatment of stakeholders, especially employees at home and abroad, and of the environment.
Some of Warren Buffett's big stocks bets have tanked in 2014, and the market hasn't let it pass unnoticed. In fact, anytime a stock Buffett owns declines, the "billions being lost" by Warren makes it into the headlines. With all the fuss over Warren Buffett's stock-picking prowess, or lack thereof, you might think Berkshire Hathaway has suffered mightily. You'd be wrong, though—way wrong. In fact, Buffett has plenty of reason to smile: Berkshire Hathaway is crushing the S&P 500. [...] While the headlines may not overstate the actual size of potential losses on individual stocks, they do overstate the importance of those losses to Berkshire Hathaway as a corporation. "Most investors overestimate the significance of Berkshire's equity portfolio," said Meyer Shields, Stifel analyst.
At least half a dozen stocks that Ted Weschler and Todd Combs probably picked for Berkshire Hathaway Inc.’s portfolio are poised to end the year lower than where they started. They include energy companies that have slumped with oil prices; automaker General Motors Co., which has struggled with recalls; and Chicago Bridge & Iron Co., an engineering and construction firm that’s down more than 50 percent since Dec. 31. “It appears, on first glance, that Todd and Ted have underperformed the S&P 500 this year,” said David Kass, a professor at the University of Maryland’s Robert H. Smith School of Business who has studied Berkshire’s portfolio.
Warren Buffett‘s “All-Stars” are getting their biennial reminder this month that they need to guard Berkshire Hathaway Inc.'s reputation–and plan for the future. Mr. Buffett, who’s run Berkshire for the past five decades, sends a memo every other year to the managers of each of Berkshire’s 80-plus subsidiaries that emphasizes those two points. [...] The latest memo also reminds the managers–who he’s dubbed “The All-Stars”–to keep him in the loop about “who should take over tomorrow if you should become incapacitated overnight.” Generally, the managers operate with a large degree of autonomy, and Mr. Buffett says elsewhere in the letter that they can “talk to me about what is going on as little or as much as you wish.” But Mr. Buffett himself takes responsibility for keeping a roster of potential replacements for each of the leaders of Berkshire’s far-flung operations.
See's Candies President and CEO Brad Kinstler, speaking after appearing on a Stanford University panel discussion this month, said he's eager to one day replicate the company's California success on the East Coast. But he's not saying when that will happen, noting that See's Candies shops can be found as far east as Pittsburgh. The South San Francisco-based company also operates temporary locations in East Coast cities during holidays when chocolates are in demand.
Chinese electric-car maker BYD Co. Ltd. (1211.HK), which is backed by investor Warren Buffett, Friday said Mr. Buffett's Berkshire Hathaway Inc. (BRKA) has no present intention to cut its stake in the company. BYD also said it wasn't aware of a substantial share sale by Mr. Buffett, who holds 225 million H shares in the company. The car maker's statement comes a day after its Hong Kong-traded shares plunged as much as 47%. BYD said its business operations remain normal and that it hasn't incurred substantial foreign exchange losses despite the weaker Russian ruble.
PacifiCorp, one of the utilities owned by Berkshire Hathaway Inc.’s energy unit, agreed to pay $2.5 million to settle charges that its wind facilities in Wyoming killed eagles and other birds. The deaths near the Seven Mile Hill and Glenrock/Rolling Hills wind farms violated the Migratory Bird Treaty Act, according to a statement today from the utility. PacifiCorp said it will pay $400,000 in fines, $200,000 in restitution to the Wyoming Game and Fish Department and $1.9 million to the National Fish and Wildlife Foundation to help protect golden eagles near the facilities.
PacifiCorp has been cooperating with federal authorities to reduce migratory bird mortality, particularly eagles, at its wind facilities. Following guidelines issued by the U.S. Fish and Wildlife Service in 2012, PacifiCorp drafted migratory bird protection plans and hired qualified wildlife observers to monitor the wind sites for eagle activity. Operators were notified to shut down turbines to reduce risks when eagles were observed in the area. Other measures the company took included removing features from the project landscape that attract prey species. As part of the settlement, PacifiCorp will take measures at the company’s wind facilities in Wyoming to increase eagle populations.
Following an unsuccessful 18-month attempt to sell the Deer Creek coal mine, PacifiCorp announced today it will close the mine in Emery County, Utah, because it has become too costly to operate for customers. PacifiCorp also signed a long-term coal supply agreement with Bowie Resource Partners LLC to supply coal for the Huntington power plant. Energy West Mining Company, PacifiCorp’s subsidiary operator of the mine, notified the mine’s 182 workers of the pending closure. [...] The Deer Creek mine has an estimated five years or less of reserves, but much of the remaining coal has higher ash and sulfur content that has made mine production considerably more expensive and has made it more expensive to comply with air quality standards. Bowie Resource Partners LLC has signed a contract to provide the coal needed for the Huntington power plant, and will source the plant from its mines in Utah. Rapidly escalating pension liabilities for the mine’s represented workforce was a large factor in the economic viability of the mine.
Buffett’s Northern Powergrid Holdings Co. is working with Siemens AG to test a so-called smart grid that has the ability to control when consumer appliances will be used in the home. Being able to better manage when electricity flows allows utilities to lower consumer costs by reducing the need for new equipment, and to better handle surges and gaps from intermittent sources such as wind and solar. The pilot program, known as the Customer-Led Network Revolution, involves just 12,000 households in the U.K. and is one of only a few such projects being tested worldwide.
Buffett was seated on the baseline near the Cavaliers bench as a guest of James and, perhaps more so, of owner Dan Gilbert, who sat next to Buffett. He watched James score 27 points, dish out 13 assists, and grab seven rebounds, then chatted with James and Gilbert in the locker room afterwards. Buffett, 84, chief executive officer of Berkshire Hathaway, is the second-richest man in the United States with a net worth of $71.6 billion, according to Forbes.com. He was donning a white No. 23 Cavaliers jersey Monday night. On Sunday, he attended a Detroit Lions football game and wore a No. 90 jersey for the Lions' Ndamukong Suh.
Last week, Buffett set up a developer company in Spain called Berkshire Residential Assets 1, with an objective of buying all property types, principally dwellings put up for sale by the sector’s companies, banks and Sareb, the bad bank. Known as the ‘Oracle of Omaha’, the investor plans to include rehabiliation and building construction services in its vehicle’s activities range. The third richest man on the globe has bought Catalan firm Merquinsa and has come to an agreement with Caixabank on reinsurance of its policy portfolio valued at €600 million.
A company that operates at least 13 wind-energy facilities across three states is suing in federal court to block the U.S. government from releasing information about how many birds are found dead at its facilities. [...] Portland, Oregon-based Pacificorp, which is owned by Omaha-based Berkshire Hathaway, is seeking an injunction in U.S. District Court in Utah to prevent the Interior Department from releasing information it considers confidential. [...] The information AP sought was part of its larger investigation into bird and eagle deaths at wind farms and the administration’s reluctance to prosecute the cases as it advocated the pollution-free energy source. AP asked the U.S. Fish and Wildlife Service for data collected under federal permits given to companies to collect the carcasses of protected bird species, including eagles and migratory birds, found dead at their facilities.
Berkshire Hathaway Travel Protection is beginning to allow customers to file claims electronically by taking photos of receipts with their smartphones. Berkshire Hathaway will then electronically deposit a payment into a customer's bank or PayPal account instead of mailing a check. When filing claims, customers do not have to send in original claim receipts. The new program is called ExactCare, and Berkshire Hathaway is beta testing it with travel agents and other industry partners. It will do a full rollout in the first quarter of 2015.
Berkshire Hathaway Specialty Insurance (BHSI) has unveiled its Executive First Side A Difference-in-Conditions (DIC) Directors & Officers Liability Policy, which provides protection for individual directors and officers in a concise form.
Berkshire Hathaway Specialty Insurance (BHSI) has created a Contractor’s Broad Form Coverage, which is now available to contractors with BHSI’s primary general liability practice policies. In addition, BHSI is offering contractors its Business Crisis Event Cost Coverage endorsement with these enhancements, further strengthening contractors’ ability to respond in a time of need while managing their risk.
Not to be outdone by the pumpkin flavor craze, the Dairy Queen® system, a Berkshire Hathaway company, is bringing back its popular peppermint treat just in time for the holidays. The DQ® system announced today the return of the Candy Cane Chill Blizzard® Treat as the featured Blizzard of the Month for December.
Warren Buffett’s Berkshire Hathaway Inc. agreed to buy Van Tuyl Group, the largest privately owned U.S. auto dealership group. The business, with more than 100 franchises, will be renamed Berkshire Hathaway Automotive and continue to be run by Larry Van Tuyl, Omaha, Nebraska-based Berkshire said today in a statement that didn’t disclose terms. The target company has more than $8 billion of revenue. “I fully expect we’ll buy a lot more dealerships,” Buffett told CNBC in an interview today. “We’ve gone a long time without getting into automobiles, but Larry’s got an operation that we think could be scaled up a lot from where it is.”
When Buffett signed a deal to buy Van Tuyl Group last week through his Berkshire Hathaway Inc. investment company, he clearly signaled that the top four dealership groups are in his sights. When a CNBC host mentioned AutoNation Inc. and said it was the country's biggest auto retailer, Buffett quipped: "Temporarily." "This is just the beginning for Berkshire Hathaway Automotive," Buffett said of the new venture, which is being called the biggest acquisition by far in automotive retail history. Terms weren't disclosed, but outsiders estimated the all-cash price tag at over $4 billion.
Custom injection molder Ironwood Plastics Inc. has embarked on an ambitious expansion program. The Ironwood, Mich., company will spend $19 million in Twin Rivers, Wis., to buy a building next door to its factory there and to add injection presses. [...] Ironwood’s new strategic push is partly due to it being part of CTB Inc., a Milford, Ind., company that sells internationally. CTB primarily makes agricultural products and most of its molded components are made in house but Ironwood molds a few complex parts for CTB. CTB has been owned by investment giant Berkshire Hathaway Inc. since 2002. The CTB and Berkshire Hathaway connections help Ironwood’s access to capital and give customers more confidence to do business with the custom molder. CTB acquired Ironwood in 2010 from the Stephens family, which had founded it in 1979.
Billionaire investor Warren Buffett said his investment in Tesco Plc was a “huge mistake,” as the U.K. supermarket leader’s share price remains close to an 11-year low amid declining sales and an accounting probe. [...] Buffett’s Berkshire Hathaway Inc. has held Tesco shares since March 2006, when it acquired a stake for $328.7 million. By 2012, the holding had reached 5.08 percent of the grocer’s shares, worth about 1.3 billion pounds ($2.1 billion). More recently, Buffett has been cutting the stake, owning 3.7 percent of the shares as of Dec. 31, according to Berkshire Hathaway’s annual report.
Thanks in part to the transmission lines alongside Interstate 15, Mr. Buffett’s company, Berkshire Hathaway, and its subsidiary Berkshire Hathaway Energy stand to make steady, predictable profits in an energy market undergoing transformations. “This is not a value play,” said Christine Tezak, managing director of research at ClearView Energy Partners, referring to Mr. Buffett’s normally conservative investing approach. “He’s looking at this as a way to participate in the structural shift taking place in the power and energy industry.”
Starting next month, PacifiCorp will start simulating the trading of generation and grid capacity every fifteen minutes on CAISO’s market, with “financially binding” operations to start in November, according to the U.S. Energy Information Administration. CAISO is also working with NV Energy to add most of Nevada’s grid to its EIM as well, with operations set to start in fall 2015. Both utilities are owned by Berkshire Hathaway [...] The rewards, according to a study by the Energy and Environmental Economics (E3) research group, could add up to $21 million to $129 million for PacifiCorp by 2017 or so, as the company buys lower-cost power from California’s grid or sells its own capacity when CAISO prices are high.
Bill Gross’s departure from Pacific Investment Management Co. sent ripples through the bond market. Berkshire Hathaway Inc. pensioners didn’t feel it. Warren Buffett, Berkshire’s chairman and chief executive officer, said today that he didn’t know of a single investment that his company or its dozens of subsidiaries had with Pimco, manager of the world’s largest bond fund. Why? “We manage all of our pensions internally, except for those connected with the utility business,” Buffett said today in an interview with CNBC. “We are all-equities, anyways. We don’t have any bonds in our pension funds.”
[...] even though the Omaha, Neb.-based billionaire is continuing to grow his empire, completing two multi-billion dollar deals in 2013 alone, it is inevitable that Berkshire will someday reverse course and unleash the greatest spin-off investment bonanza the world has ever seen. [...] Upon Berkshire's realignment, these two deals alone could spawn upwards of 50 independent companies. Heinz will be able to spin off over 10 of its corporations to shareholders, and I envision Hortons, along with Burger King, following suit with over 40 separate entities.
It’s been a good week for billionaire investors: on Tuesday, Carl Icahn got his way when eBay announced that it and PayPal will go their separate ways. And on Wednesday, Coca-Cola announced that it will revise the executive pay structure that Warren Buffett recently called “excessive.”
Berkshire Hathaway Chairman and CEO Warren Buffet has dismissed a report that gave his investment firm a low score for its LGBT policies. Berkshire scored a “0” on the Human Rights Campaign's (HRC) annual Corporate Equality Index (CEI), which ranks companies based on employment policies and practices pertaining to lesbian, gay, bisexual and transgender employees. [...] “I do not set the policies for the 75 companies,” he said, then added, “Certainly, our managers know how I feel. I am 100% for full rights, in every respect, for gays and lesbians.”
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