Berkshire News Briefs - 8/5/16

Berkshire Said to Draw Fed Scrutiny Over Wells Fargo Investment (Bloomberg)

Berkshire has asked the Fed for approval to maintain and even increase its 10 percent stake in Wells Fargo, saying in a June application that it may seek to “purchase additional shares.” If the Fed denies the request, Berkshire might have to dial back the holding of about $24 billion that Buffett described in a recent shareholder meeting as “our largest marketable security."

Omaha, Nebraska-based Berkshire probably wouldn’t have to sell anything if it can persuade regulators that its stake in AmEx doesn’t mean it exerts any control over the credit-card company. Berkshire has successfully made the argument in the past to banking agencies. [...]

Warren Buffett’s Short-Term Hit and Run Transactions (Insider Monkey)

The examples in the article are Express Scripts (ESRX), Archer Daniels Midland (ADM), Intel (INTC), CVS Health (CVS), and Exxon Mobil (XOM).

Warren Buffett is known for his highly successful value investing approach. [...] However, over the past few years, his fund, Berkshire Hathaway, has disclosed some short or medium-term stakes, positions it did not maintain for more than a year.

In many occasions, these stocks were picked by one of Buffett’s hedge fund managers, Todd Combs and Ted Weschler, and not by himself. [...] As readers will notice, it seems like Combs and Weschler’s strategy is all about profit taking, acquiring stocks at low prices and selling when they surge, instead of keeping them for long periods of time. [...]

Warren Buffett Made a Big Bet On an 'In-Your-Face' CEO (Bloomberg)

[Precision Castparts CEO Mark] Donegan, 60, a former Villanova University football player who devoted most of his career to Precision, shares many qualities with other Berkshire managers: He’s a low-profile CEO with a great track record, relentless about staying ahead of the competition. During the 13 years he led Precision as a publicly traded company, its stock climbed 20-fold, annual revenue quadrupled to $10 billion and he bought dozens of businesses, consolidating a position as a key supplier to Boeing Co., Airbus Group SE and General Electric Co. It helped him attain a cult status among investors. [...]

Behind the numbers, though, something more brutal is going on. For years, Donegan has traveled the globe, sometimes bullying staff during quarterly reviews at Precision plants. Bloomberg News spoke with 15 current and former employees—some at the most senior levels of the organization—as well as half a dozen people with knowledge of how the company is run. Those who know the CEO best describe a manager who’s highly effective but at times strains basic decency. [...]

Book Review: Inside The Investments Of Warren Buffett (Investing-dot-com)

I have no idea how many books have been written about Warren Buffett, but sometimes I have the feeling that he is giving George Washington a run for his money. The latest addition to the literature is Yefei Lu’s "Inside the Investments of Warren Buffett: Twenty Cases" (Columbia Business School Publishing, 2016).

Lu examines 20 investments Buffett made over the course of his career that, in Lu’s opinion, “had the largest material impact on his trajectory.” He puts himself in the shoes of imaginary investment analysts “studying the businesses at the same time … Buffett did.” Why would an ordinary analyst either recommend or, as would often have been the case, argue against investing in a company to which Buffett eventually opted to commit funds? [...]

The DQ® System Announces Plans to Develop 24 Locations in Five Caribbean Countries in the Next Five Years (Business Wire)

If you read these News Brief posts the whole way to the bottom every time, you know that I have a thing for these recurring, formulaic Dairy Queen press releases. They mean almost nothing to Berkshire Hathaway's bottom line in the grand scheme of things, but I love to see DQ expanding to all the corners of the globe anyway.

Plans call for the development of DQ Grill & Chill® locations in Trinidad and Tobago, DQ Grill & Chill and DQ Treat locations in Jamaica, and DQ Treat locations in St. Lucia, Grenada and St. Maarten. Currently, there are eight DQ Treat locations in Trinidad, the first of which opened in 2012. [...]

Royal Treats Ltd. signed the multi-unit, multi-country agreement with American Dairy Queen Corporation (ADQ) to develop the new locations. They currently operate eight DQ Treat locations throughout Trinidad and Tobago [...] With their new agreement, they will introduce DQ Grill & Chill locations to fans in Trinidad and Jamaica.

Berkshire News Briefs - 4/12/16

Buffett Deputy Jain Will Add Gen Re Oversight as Montross Exits (Bloomberg)

Ajit Jain, long considered a top candidate to replace billionaire Warren Buffett as chief executive officer of Berkshire Hathaway Inc., is expanding his oversight of the company’s insurance operations.

Gen Re, one of the major reinsurance businesses at Berkshire, said Tuesday that CEO Tad Montross, 60, will step down by the end of this year. His replacement hasn’t been named, but will report to Jain, said Sabine Denne, a spokeswoman for the reinsurer.

Berkshire Hathaway Sees Power Market as Electrons' Match.com (Bloomberg)

Berkshire Hathaway Inc.’s energy unit has been courting three dozen power transmission operators in the western U.S. to join its utilities and the California grid in trading power across their borders electronically and instantaneously. This means traders wouldn’t need to pick up the phone or send e-mails each hour to schedule the purchase and sale of renewables while hoping the sun and wind hold out until the next hour.

This so-called Energy Imbalance Market is the equivalent of creating a “Match.com for electrons,” Jonathan Weisgall, vice president of government relations at Berkshire Hathaway Energy, said [...]

Clayton Homes buys Alabama manufactured-housing company (Knoxville News Sentinel)

Maryville-based Clayton Homes has acquired manufactured-home builder River Birch Homes of Hackleburg, Ala.

In a release, Clayton Homes said the purchase includes all operating assets of River Birch Homes, and is effective immediately.

River Birch, which makes single- and multi-section homes and markets them in nine states throughout the Southeast, has nearly 240 employees in the Hackleburg area, in northwest Alabama.

The company was started in 1997 by owners Delmo Payne and Gerald Terrell.

Acme Brick Co. to close Springfield and Edina brick facilities for good this year (Minneapolis Star Tribune)

Texas-based Acme Brick Co. will officially shut its Minnesota operations for good later this year, a move that will affect 19 employees.

The company will keep its Edina sales office open to serve customer orders through Sept. 30. Its Great Lakes Plant in Springfield, Minn., which stopped producing bricks in 2014, will not restart production as expected. Instead it will sell its remaining inventory at the Edina facility and through select distributors.

Acme acquired the Great Lakes Plant in January 2008. It was Minnesota’s last operating brick plant and was formerly part of Ochs Brick Co. [...]

Fire at Nebraska Furniture Mart warehouse caused estimated $1.4 million in damage (Omaha World-Herald)

Insurance officials still are investigating the cause of a fire that caused an estimated $1.4 million in damage in Nebraska Furniture Mart’s flooring warehouse Sunday.

The flooring center remained closed Monday, but the retailer is operating normally otherwise.

The fire involved boxes of laminate flooring and as a result was quite smoky, retired Furniture Mart executive Bob Batt said. [...]

Acquisitions lead Lubrizol to expand its offerings (Crain's Cleveland Business)

Lubrizol Corp. is expanding its health care product offerings and investing $15 million in the effort, the Wickliffe-based company announced at the Medical Design and Manufacturing West trade show and conference in Anaheim.

Expanding Lubrizol LifeSciences offerings has in part been made possible with the recent acquisition of Vesta Inc. and Particle Sciences, whose capabilities are turning the company’s health-care business into the “polymer-based drug delivery company” of the future, company reps said [...]

Shaw industries land on Forbes' "America's Best Employers of 2016" list (Chatanooga Times Free Press)

Calhoun-based Mohawk Industries, the world's largest flooring maker, and Dalton-based Shaw Industries, the world's largest carpet maker, are two the best industrial manufacturers in the country to work for, according to the latest Forbes' "America's Best Employers of 2016" list. [...]

Shaw ranked 282 overall [out of 30,000], and number 18 in the engineering/manufacturing category. [...]

Shaw is a wholly-owned subsidiary of Berkshire Hathaway, Inc., with more than $4.8 billion in sales and more than 22,000 employees.

Chinese aviation firm to take 25% stake in NetJets China (Flight Global)

Chinese business aircraft manager Business Aviation Asia will take a 25% stake in the China unit of fractional ownership firm NetJets. [...]

NetJets China is a joint venture between the US-based fractional ownership giant and a consortium of Chinese investors, led by private equity firm Hony Capital and Fung Investments. It operates two aircraft on a charter basis in the mainland. [...]

Initial bids for Kansas utility Westar Energy due this week (Utility Dive)

Initial bids for Westar Energy are due this week, according to Bloomberg, and the company has reportedly been courted by a wide range of potential investors, from Canadian investment companies to rival utility Ameren.

Warren Buffett's Berkshire Hathaway has also been named as a potential suitor, with the Hillsboro Free Press reporting it is not the first time the billionaire investor has considered acquiring the utility. [...]

Brooks Unveils London Transit-Inspired Adrenaline GTS 16 (Footwear News)

Brooks Unveils Boston Marathon Shoe Inspired By New England Lifestyle (Footwear News)

Brooks Running is rolling out some unique-looking running shoes in conjunction with some of the most popular marathons.

Top running brands are getting ready for the upcoming Boston Marathon, prepping sneakers for the celebrated race. One such brand is Brooks, with a reimagined iteration of its Adrenaline GTS 16, hitting stores in April. The Brooks “Nantucket” Adrenaline GTS 16 is scheduled to hit stores Friday and retail for $130.

New book offers detailed analysis of Buffett’s investments (Omaha World-Herald)

Yefei Lu, a portfolio manager for Shareholder Value Management of Frankfurt, Germany, analyzes 20 of Berkshire’s investments, from the Sanborn Map Co. in 1958 to IBM in 2011, in a forthcoming book, “Inside the Investments of Warren Buffett” [...]

In a final chapter titled “What We Can Learn From Buffett,” Lu says Buffett, chief executive of Berkshire Hathaway Inc., seeks “an abundance of relevant objective data for the companies in question.”

Berkshire News Briefs - 5/13/13

Berkshire Hathaway profits up more than 50% (Financial Times)

Berkshire Hathaway said first-quarter profits had jumped more than 50 per cent from the year-ago period because of insurance gains and overall growth from the $268bn conglomerate’s diverse mix of business. [...] The largest contributor to the rise was insurance underwriting profits of $901m, compared with $54m last year. The rise included a one-off gain of $255m related to amendments to a contract with a unit of Swiss Re. Overall revenues of $43.9bn rose from $38.1bn a year ago.

Berkshire Hathaway's 1st Quarter Press Release and 10Q filing.

The Berkshire Hathaway Q&A (Omaha World-Herald)

During more than five hours of fielding questions from shareholders, journalists and financial experts, Berkshire Hathaway Chairman and CEO Warren Buffett and Vice Chairman Charlie Munger were asked why they do what they do, what changes they would consider and what the secrets of their success are.

For more detailed notes on the Q&A session, here's an account of it from the Motley Fool BRK-A board.

Warren Buffett's Candy: His Sweet Tooth for See's Candies, Dairy Queen (YouTube / Bloomberg Video)

Bloomberg's Betty Liu profiles the sweet side of Warren Buffett's empire with See's Candies and Dairy Queen as both companies look to expand while keep commodity costs under control. She speaks on Bloomberg Television's "In The Loop."

Berkshire Hathaway Shareholder Meeting Picketed By Utah Coal Miners (Huffington Post)

Dozens of Utah coal miners are picketing outside the Berkshire Hathaway's annual meeting in downtown Omaha. The protesters are members of United Mine Workers of America who work at Deer Creek mine near Huntington, Utah. The mine is run by a subsidiary of Berkshire's MidAmerican Energy Holdings Co. The union's contract expired in January, and the union and company are disagreeing on health care coverage and safety checks.

Berkshire's B-Share Generation (The Street)

Nick Antoine traveled to Berkshire Hathaway's annual shareholder meeting with air miles and lodged in a "dirt cheap" hotel room with a ceiling that leaked water from an overflowing toilet a floor above. The 24 year-old Princeton University graduate was forced to splurge on taxis due to unseasonably cold weather at the May 4 investor gathering in Omaha, Nebraska. [...] Twenty-somethings like Antoine describe the pilgrimage to Omaha as an affirmation of independent thinking in business and investment. Buffett's values and Munger's lucidity also carry an appeal beyond their stewardship of Berkshire and its more than 80 operating subsidiaries. Those youthful shareholders are building in number, according to longtime attendees of Berkshire's meeting. The company has dramatically expanded its investor base since splitting Class B shares, first issued in 1996, by 50-to-1 in 2010.

The Cult of Buffett (Fool Video)

The Berkshire Hathaway annual meeting has reached a cult-like status. People flock from around the world to hear words of wisdom from the Oracle of Omaha. But what did Warren Buffett actually reveal about the inner workings of Berkshire?

Here's How Warren Buffett Disappointed Me (Fool)

The Berkshire Hathaway annual meeting is attended by throngs of Berkshire faithful. For some shareholders at the meeting, it's probably impossible for Berkshire CEO Warren Buffett to ever be wrong in their eyes. If we're being realistic, though, Buffett does indeed have his slip-ups. As partner-in-crime Charlie Munger put it: "Just because Warren thought something years ago doesn't make it a law of nature." With that in mind, I rounded up the team of Fools who attended this year's Berkshire meeting to ask in what ways Buffett disappointed them during the meeting.

25 Surprising Facts About Berkshire Hathaway (Fool)

Berkshire's roots go back more than 174 years to the founding of textile manufacturer Valley Falls Company, which itself merged with Berkshire Cotton Manufacturing Company in 1929. The resulting company merged with Hathaway Manufacturing to create Berkshire Hathaway in 1955.

In 2010, Warren Buffett said he considered Berkshire the "dumbest" stock he ever bought. Why? Because in 1962 he acquired his controlling stake in anger when one of its managers short-changed him in a tender offer to the tune of $0.125 per share. After he fired the manager, Buffett realized he had committed too much of his money to a "terrible" textiles business, which he fought to save for 20 years before giving up. By Buffett's estimation, that mistake cost him more $200 billion in compounded returns.

Berkshire Sells Debt to Buyers Buffett Pities (Bloomberg)

Berkshire Hathaway Inc.’s $1 billion note sale shows that while Chief Executive Officer Warren Buffett may pity investors who’ve stuck with bonds as yields fall to record lows, he’ll sell them as much debt as they want.

The company’s Berkshire Hathaway Finance Corp. sold five-and 30-year securities offering the company’s lowest coupons for those maturities ever.

New book teaches children ABCs of Warren Buffett's Berkshire Hathaway (NDTV)

Two Omaha residents, author Nancy Rips and illustrator Tom Kerr, have teamed up on "My First Berkshire ABC" to teach children about one of the world's best-known companies, and a little about the local billionaire behind it. [...] Most pages show companies that Berkshire owns or invests in. G, for example, is for "Geico," and features the car insurer's talking gecko. And W is for "Wells Fargo", and features the bank's familiar stagecoach.