Berkshire News Briefs - 4/3/14

MiTek acquires Ohio HVAC fabricator Ellis & Watts (St. Louis Post-Dispatch)

MiTek Industries has acquired Ellis & Watts Global Industries, a designer and fabricator of HVAC products for nuclear and military customers. Chesterfield [Missouri]-based MiTek, a supplier of engineered products, software and equipment for the construction industry that's owned by Berkshire Hathaway, said Batavia, Ohio-based Ellis & Watts will operate as a subsidiary of MiTek. [...] “By offering highly engineered HVAC and other solutions into a wide range of end markets, Ellis & Watts enables MiTek to further expand its Industrial Business segment," Tom Manenti, chairman and CEO of MiTek, said in a statement.

Berkshire Hathaway Specialty Exec on Acquisitions, Expansion Plans (Insurance Journal)

BHSI’s [Berkshire Hathaway Specialty Insurance] President Peter Eastwood said BHSI is “working hard at some expansion plans in Asia and in Europe as well” while an expansion in Latin America is “a little bit further down the road.” BHSI expects to make expansion moves outside the U.S. sometime in 2014, Eastwood said [...] Insure America LLC is a brokerage operation specializing in the travel agency errors and omissions (E&O) business, Eastwood said, “and we are going to replace the paper that supports it and write that business on our paper.” And MyAssist offers a personal assistance concierge service for motorists, Eastwood explained. [...] “Having call center capabilities within our organization will be of a huge value to us on the claims side,” he said. “It has a huge value to us as we think about expanding our business into different areas — including into the consumer space.”

Unionized Employees Picket NetJets Corporate Office (Yahoo / PR Newswire)

When you read this, note that it's a press release written by the union.

In a powerful display of solidarity, approximately 200 unionized NetJets employees participated in an informational picket across the street from the Berkshire Hathaway subsidiary's corporate headquarters to focus attention on escalating attacks on their pay, benefits and working conditions amid record profits. The event was hosted by the NetJets Unions Coalition (NUC) whose formation was announced earlier this month.

NetJets® Newest Jet Model Taking Flight (Business Wire / Marketwatch)

NetJets is the launch partner for the all-new Bombardier Challenger 350. NetJets Inc., a Berkshire Hathaway company and the worldwide leader in private aviation, announced today that it is flying a demonstration model of the all-new aircraft to more than 20 cities in the U.S. The company is showing the model to current and prospective customers. [...] NetJets will take actual delivery of the first jet this summer. The Challenger 350 jet boasts class-defining performance, 3,780 sm (6,083km) range and will connect New York to Los Angeles and San Francisco to Maui.

Berkshire Hathaway HomeServices Launches National Ad Campaign (Business Wire / Marketwatch)

Berkshire Hathaway HomeServices, the new real estate brokerage network operated by HSF Affiliates LLC, today launched a national advertising campaign to continue building brand awareness and underscoring the network’s expertise. The campaign, developed by BBDO Minneapolis, positions Berkshire Hathaway HomeServices as a brand that is “Good to know” when buying or selling a home because of its agents’ skill and forward-thinking approaches. [...] The campaign launches with :30 and :15 TV spots airing on national cable networks as well as print and digital advertising in The Wall Street Journal and industry trade publications.

Manhattan Will Get Its First Dairy Queen This Spring (HuffPost)

(Berkshire Hathaway owns Dairy Queen.)

There are 6,400 Dairy Queen locations around the world, and now you can add one more store to that number. Get ready, Manhattan, because you're about to be hit with another Blizzard. 75 years and 27 countries later, Dairy Queen is finally DQ'ing something different, and finding its way to the Big Apple. [...] In 2013, Dairy Queen opened a location just outside Manhattan, but the new location will be at 54 West 14th Street, between 5th and 6th Avenues.

Detroit-based Fathead to sell Warren Buffett Big Head wall posters for charity (MLive)

When Warren Buffett came to Detroit last fall to announce a $20 million small business lending program with Goldman Sachs, he also visibly spent time with Quicken Loans founder and Chairman Dan Gilbert. [...] In the latest Gilbert-Buffett collaboration, Fat Head announced this week that it will be selling a Warren Buffett Big Head, a large cut-out graphic that can be stuck to walls, and is donating proceeds to two Detroit charities. Fathead, which is part of Gilbert's Rock Ventures umbrella company, makes its large wall cutouts for more than 600 licensed brands and has thousands of graphics of athletes, superheroes and celebrities.

You can buy yours here.

Social media maven Warren Buffett's tweeting advice (CNBC + video) http://www.cnbc.com/id/101549253

Warren Buffett, despite what it says in our attempt at irony in the headline, is no expert on social media. [...] That's the joke behind a humorous video from the college Buffett attended more than 60 years ago, the University of Nebraska-Lincoln. In it, Buffett ("The Oracle") is seen wearing a bright red jacket (the school's color) while hand-checking a massive pile of NCAA brackets in front of him. As he happily finds an error, ("Ha! Another loser"), a bright red desk telephone rings.

Berkshire News Briefs - 3/25/14

Buffett's Berkshire gets its first TV station (CNBC)

For the first time, Warren Buffett's Berkshire Hathaway will directly own a television station. Under terms of an agreement in principle announced Wednesday, Berkshire will get ABC-affiliate WPLG in Miami from Graham Holdings. Graham holds the assets that remained after the Washington Post Co. sold its namesake newspaper to Amazon chief Jeff Bezos for $250 million last August. In the new deal, Graham would swap the station, some Berkshire shares it owns and some cash in exchange for roughly 1.6 million Graham shares now held by Berkshire. [...] The trade would leave Berkshire with just about 100,000 shares.

Media General to buy LIN in US$2.6b broadcast deal (NewsAsia)

US broadcaster Media General said on Friday it will buy LIN Media in a US$2.6 billion deal that creates the nation's second-largest television broadcasting company and a digital media powerhouse. The merged company will own and operate or service 74 television stations across 46 markets, and serve some 26.5 million households, or 23 percent of the US market, Media General said in a statement. [...] Media General, partly owned by tycoon Warren Buffett's Berkshire Hathaway, will form a new holding company that will be named Media General.

Warren Buffett's Warrants Shine in Media General Deal (The Street)

As Media General works to merge with LIN Media, forming the nation's second largest pure-play TV broadcasting company, Berkshire Hathaway continues to make money off of a newspaper deal it cut with Media General in 2012. In May 2012, Berkshire Hathaway bought 63 newspapers from Media General for $142 million in cash and agreed to provide the nationwide TV broadcaster with a $400 million term loan and a $45 million revolving credit line, as the company worked to repair its balance sheet. As part of the newspaper purchase and its loan to Media General, Berkshire also received penny warrants for approximately 4.6 million of Media General's Class A shares, about 20% of its outstanding stock at the time. Berkshire's loans, which carried an interest rate of 10.5%, and its warrants, quickly paid off.

Buffett’s BNSF Leads Locomotive Surge to Ease Railroad Cargo Jam (Bloomberg)

BNSF Railway Co., owned by Warren Buffett’s Berkshire Hathaway Inc., is leading an effort by U.S. railroads to add hundreds of locomotives to ease a cargo jam spurred by bad weather and surging crude shipments. BNSF increased engines by 250 in the last two months and will have another 125 new ones on the tracks in the next two months, the company said. [...] The congestion started with BNSF before the bad weather because of equipment shortages and increasing cargo, then worsened as the snowstorms swept in, said Jason Seidl, an analyst with Cowen & Co. “A lot of business came their way and they sort of got behind the eight ball,” he said. “Then the weather hit and the rest is history as they say.”

Buffett’s Hathaway Compensation Rises to $485,606 (Claims Journal)

Well, OK, I guess he's earned a small raise.

Warren Buffett’s compensation from Berkshire Hathaway Inc. rose 15 percent last year to $485,606, although the billionaire’s salary remained $100,000. The increase came in “other compensation,” which includes company-paid costs for Buffett’s personal and home security. As usual, Buffett reimbursed Berkshire $50,000 for personal costs such as postage and phone calls.

Will This Company Soon Be Warren Buffett's Biggest Holding? (Fool)

Believe it or not, Bank of America could soon become the single largest holding of Warren Buffett's Berkshire Hathaway. Shocking, I know, but the math is really quite simple. Two and a half years ago, Buffett invested $5 billion in Bank of America. In exchange, Berkshire received a corresponding amount of preferred stock that pays a 6% dividend, and warrants to buy 700 million shares of the bank's common stock at an exercise price of $7.14 per share. The warrants expire in September of 2021. At today's price of roughly $17.90, Berkshire has already more than doubled its initial investment -- and that excludes the preferred stake. The common-stock position has been so lucrative, in fact, that it's become, in effect, Berkshire's fifth largest equity holding.

Berkshire Hathaway HomeServices Named ‘Real Estate Agency Brand of the Year’ in 2014 Harris Poll (Business Wire)

Berkshire Hathaway HomeServices, the new real estate brokerage network operated by HSF Affiliates LLC, today announced it was named “Real Estate Agency Brand of the Year” in the 26th annual Harris Poll EquiTrend study. Berkshire Hathaway HomeServices received the highest ranking in the Real Estate Agency category based on consumers’ perception of its brand familiarity, quality and purchasing consideration, among other qualifying elements. The study was based on opinions of more than 40,000 U.S. consumers surveyed online earlier this year.

Buffett Wins NCAA Billion-Dollar Hoops Bet as Brackets Go Bust (Bloomberg)

It took less than two full days of play for Warren Buffett to win his bet that no entrant in a Quicken Loans Inc. contest would predict the winner of each game in the three-week-long National Collegiate Athletic Association men’s basketball tournament. [...] Two upsets -- Dayton’s defeat of Ohio State two days ago, and Mercer’s win yesterday against Duke -- wiped out 99 percent of the entries. When Memphis defeated George Washington last night, the last of the perfect brackets was busted.

In preparing the news briefs post, I found this interesting two-part story on Seeking Alpha about the corporate structure of Berkshire Hathaway. I thought it was more nuts-and-bolts and not general interest news, so I dropped it down to the bottom; if you don't care how the sausage is made, you're welcome to skip over this post.

On The Structure Of Berkshire Hathaway, Part 1 (Seeking Alpha)

Berkshire Hathaway is a unique company. You have a property-casualty insurance giant owning many businesses directly through insurance subsidiaries, including huge businesses like a Class 1 Railroad - BNSF. Yes, National Indemnity owns BNSF in entire, and many other businesses as well. I thought the pre-crisis organization chart of AIG was complex - because of the many industries that it covers, BRK is far more complex.

On The Structure Of Berkshire Hathaway, Part 2: The Harney Investment Trust (Seeking Alpha)

In Omaha, there is Farnam Street. Among value investors, it is well-known, because the small main office of Berkshire Hathaway is located there. Less well known is Harney Street, but from an insurance standpoint it is important, because Berkshire Hathaway's largest insurance subsidiary, National Indemnity, is located there. One of the major assets of National Indemnity is the Harney Investment Trust, of which National Indemnity is the sole beneficiary. [...] Now, if you read through BRK's filings to the SEC, you won't find many mentions of the Harney Investment Trust. You have to read the insurance regulatory documents to find it, and even if you do that, you will still be puzzled.