By Shira Ovide
Nearly 40 years ago, Warren Buffett helped scotch a takeover of Wesco Financial, a small but profitable savings-and-loan based in Pasadena, Calif. Buffett, then an up-and-comer in his 40s, owned some stock in Wesco, and told the company and a member of its founding family, Betty Caspers Peters, that they were selling out too cheaply.
“Have they lost their minds?” Buffett thought, according to Alice Schroeder book, “The Snowball.”
Peters met Buffett in the TWA Ambassador Lounge at the San Francisco airport. After a three hour chat, according to “The Snowball,” Peters was convinced to turn down the takeover offer from the bigger bank, Financial Corporation of Santa Barbara.
Instead, Buffett’s company bought 80.1% of Wesco. He has said he overpaid because he felt guilty for scuttling the company’s first deal.
Now, decades after their airport tete-a-tete, Buffett is buying the rest of Wesco, for $547.6 million. His Berkshire Hathaway announced it will buy the 19.9% of Wesco shares it doesn’t already own, in a deal valued at about $387 for each Wesco share. (Buffett’s company paid $17 for the initial Wesco flurry of stock in the 1970s.)
“I liked Mr. Buffett enormously,” Peters, now in her 80s, told Deal Journal colleague Dennis K. Berman for a story last year. Asked if she was willing to push for more money from Buffett, Peters politely ended her conversation with Berman to spend time with her grandchildren at her home in Napa Valley. “Right now we’re picking peaches,” she said.Today, Peters shares in Wesco are valued at roughly $26 million. That will buy a lot of peaches
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