Warren Buffett's 3 Favorite Books: A guide to The Intelligent Investor, Security Analysis, and The Wealth of Nations



Latest Buffett Headlines

Loading...
Showing posts with label Star Telegram. Show all posts
Showing posts with label Star Telegram. Show all posts

Tuesday, February 12, 2013

STAR TELEGRAM - What it will take to succeed Warren Buffett


NEW YORK -- Howard Buffett said following his billionaire father, Warren, as chairman of Berkshire Hathaway will require upholding practices that have been prized for decades as the company grew to $240 billion in market value.
Protecting Berkshire's culture "means that I need to make sure that people feel that they've been treated fairly, that whatever my dad committed to them remains committed," Howard Buffett, 58, said in an interview with Bloomberg Television last week.
During more than four decades leading Berkshire, Warren Buffett, 82, has distinguished his company through his ability to allocate capital and boost investors' equity more than 5,000-fold per share. He has achieved those results by practicing a management philosophy that eschews the importance of quarterly financial results and gives autonomy to the heads of the company's more than 70 operating subsidiaries. In Fort Worth, Berkshire owns BNSF Railway, Justin Brands, Acme Brick and TTI.
The billionaire, who is also the company's largest shareholder, has said the next generation of leaders should divide his duties among a CEO, investment managers and his son, who has been on the board since 1993.
The younger Buffett is a director of Coca-Cola, the world's largest soft-drink maker, and once was the head of investor relations for Archer Daniels Midland.
He said observing his father has helped him get ready to lead a board that also includes Microsoft co-founder Bill Gates and Stephen Burke, CEO of Comcast's NBC Universal unit.
"In a way, I've been preparing for it all my life," Buffett said. "In another way, I've been on the Berkshire board now 20 years. That's a preparation."
The transition to a second generation of the family atop the board makes sense only if Howard Buffett doesn't have operational duties, said Jeff Matthews, a Berkshire shareholder and author of Warren Buffett's Successor: Who It Is and Why It Matters. The father has encouraged public policies that reward people based on their merits, rather than connections, saying in 2007 that he favors "equality of opportunity."
It is "hard to argue that out of all the potential successors to Warren Buffett, that Howard Buffett is absolutely the best guy, unless you take into consideration what the role is," Matthews said in a phone interview. "The role as chairman is not CEO. It's to preserve the Berkshire culture. And when you look at it that way, he's probably the right guy."
The elder Buffett has relied on the heads of some big units, including Tony Nicely at auto-insurer Geico and BNSF CEO Matt Rose, to run their businesses, leaving him time to weigh how to invest the company's cash.
He quipped in a 1999 message to shareholders laying out Berkshire's operating principles that he and Vice Chairman Charles Munger "delegate almost to the point of abdication."
"You don't want a CEO who's going to change that and drive managers away," Howard Buffett said. "That's probably one of the key parts of it, is just making sure that part of the culture remains intact. And people that are best suited to run the business run the business."
Warren Buffett said last year that Berkshire's board selected a manager to be the next CEO, without identifying the person. The billionaire has also ceded more oversight of the company's $88 billion stock portfolio to Todd Combs and Ted Weschler, investment managers he hired in the past three years.
Howard Buffett is the second of the billionaire's three children and the only one on Omaha, Neb.-based Berkshire's board. He said it is hard to predict how much time he would have to spend on Berkshire responsibilities once he becomes chairman.
He lives and farms in central Illinois, and travels the world as executive director of the Howard G. Buffett Foundation, which works to improve subsistence agriculture and resolve conflicts tied to food shortages.
One commitment he may have to scale back: serving as an auxiliary deputy sheriff in Macon County, Ill.
"It's probably not great for me to strap a gun on and go out in the streets with the sheriff with that responsibility," he said. "So there will probably be some things I won't do, or shouldn't do. But I'm doing it now, because I have the opportunity to do it."

Discuss this topic @ Share Investor Forum - Register free


Read more here: http://www.star-telegram.com/2013/02/10/4612318/what-it-will-take-to-succeed-warren.html#storylink=cpy

Thursday, February 11, 2010

STAR TELEGRAM: BNSF buyout set to be completed today

Posted Wednesday, Feb. 10, 2010

Shortly after 9 a.m. today, Burlington Northern Corp., the parent company of the vast BNSF Railway Co., will become a part of the Warren Buffett empire.

That's when the formal shareholder vote on the proposed $26.3 billion acquisition of Burlington Northern by Buffett's Berkshire Hathaway will take place at BNSF headquarters.

Approval of the deal, in which Berkshire is paying $100 a share in cash and stock, should be little more than a legal formality.

"It won't be a very long meeting," said John Ambler, vice president of corporate relations for BNSF.

It should be business as usual afterward, Ambler said. Buffett is not expected to make an appearance, and no ceremonies or other events are scheduled. BNSF CEO Matt Rose is planning to hold a brief news conference.

The deal, announced Nov. 3 by the two companies, marks the end of the line for BNSF as an independent, publicly held corporation.

But when the deal was announced, Buffett and Rose said the sale will have little effect on the way the railroad operates and its Fort Worth presence. Rose said his instructions from Buffett were "to run this business like a 100-year family business and try to make it better every day."

Buffett has described his decision to acquire BNSF as "an all-in bet" on the railroad "and the economic future of the United States."

"It's an absolutely essential business that will prosper as America prospers," Buffett said. "Matt Rose and his team have done a wonderful job of running that company. They're an extremely well-run railroad."

Buffett said he's optimistic about the growth prospects of railroads because of the low cost and high energy efficiency they provide in moving heavy raw materials and industrial goods.

Burlington Northern earned $1.7 billion on revenue of $14 billion in 2009. The railroad employs about 38,000 people across the country, including about 3,300 in the Fort Worth area.

Numerous lawsuits challenging the merger on grounds that the price was inadequate were filed within days of the deal's announcement. But Buffett said he would not increase his offer, and the litigation was settled after BNSF and Buffett made further disclosures of the terms.

Share Investor Links

Share Investor Blog - Stockmarket & Business commentary
Share Investor New Zealand Business News- Get more business news
Discuss this topic @ Share Investor Forum - Register free
Share Investor's Daily Forex Updates

Recommended Amazon Reading

The Essays of Warren Buffett: Lessons for Corporate America, Second EditionThe Essays of Warren Buffett: Lessons for Corporate America, Second Edition by Warren E. Buffett
Buy new: $25.88 / Used from: $28.69
Usually ships in 24 hours
Warren Buffett and the Interpretation of Financial Statements: The Search for the Company with a Durable Competitive AdvantageWarren Buffett and the Interpretation of Financial Statements: The Search for the Company with a Durable Competitive Advantage by Mary Buffett
Buy new: $16.47 / Used from: $13.52
Usually ships in 24 hours


Bookmark and Share

Friday, January 22, 2010

STAR TELEGRAM: BNSF Railway profit falls 13 percent

By BOB COX

Posted Thursday, Jan. 21, 2010

Burlington Northern Santa Fe Corp.’s profit fell 13 percent in the fourth quarter, but the company posted its smallest three-month drop in revenue all year as freight shipments began picking up.

The parent company of Fort Worth-based BNSF Railway reported a quarterly profit of $536 million, or $1.55 a share in 2009, compared with $615 million, or $1.78 a share, for the same period of 2008.

The performance reflected modest gains in the U.S. economy, a trend that BNSF Chief Executive Matt Rose said he expects will continue in 2010.

"We have seen some improvement in volumes during the second half of 2009 and expect this gradual improvement to continue," Rose said in a prepared statement.

BNSF did not hold a conference call with investment analysts or news media because of its pending merger with Warren Buffett’s Berkshire Hathaway.

For the full year, BNSF earned a profit of $1.7 billion, or $5.01 per share. That compares with $2.1 billion, or $6.06 a share, in 2008.

Fourth-quarter freight revenue was $3.57 billion, down 16 percent from $4.2 billion in 2008.

The revenue decline partly reflected a $388 million drop in fuel surcharges paid by freight shippers. For all of 2009, BNSF freight revenue declined more than 22 percent to $13.6 billion.

Union Pacific Corp., BNSF’s main competitor in the western states, reported similar results. UP’s profit declined 17 percent to $551 million, and its annual revenue fell 21 percent to $14.1 billion.

Dramatic declines in oil and fuel prices helped railroad profit margins. BNSF’s fuel expenses declined by 33 percent, or $312 million, in the fourth quarter alone. Fuel costs were down 49 percent, or nearly $2.3 billion, for the full year and accounted for two-thirds of the reduction in expenses for the year.

The earnings report could be the last issued by the company. The merger with Berkshire Hathaway is expected to close during the first quarter of 2010. A shareholder vote on the plan will occur in early February.

In November, BNSF announced that its board of directors had agreed to accept Berkshire’s offer of $26.3 billion, or $100 a share in cash and stock, for the 77 percent of the company it didn’t already own.

This week, BNSF filed documents with the Securities and Exchange Commission saying it had negotiated an agreement to settle potential class action lawsuits alleging that management had not obtained a fair price from Buffett, Berkshire’s CEO.

The company said in the filing that it had agreed to amend certain disclosures in the merger proposal documents but would not give additional compensation to shareholders to settle the lawsuits. The settlement proposal must still be approved by a Delaware judge overseeing the case.

Many lawsuits challenging the merger were filed within days of it being announced, but Buffett said he would not increase his offer.

The $100-a-share price was a 31 percent premium over the stock market price of BNSF shares the day before the deal was announced.

BNSF spokesman John Ambler said he could not elaborate on either the litigation or the earnings report because of the pending merger vote. "We want to be extra cautious not to prejudice anyone’s votes," he said.

BNSF reported that it plans to spend $2.4 billion in 2010 on capital improvements, including track repairs and replacement, signal systems, and rail cars and locomotives.

The figure is about $240 million less than in 2009, largely because the company will buy fewer locomotives.

"We remain committed to making the necessary investments to protect and grow the value of our franchise despite an uncertain economic environment," said Rose, the CEO.

Share Investor Links

Share Investor Blog - Stockmarket & Business commentary
Share Investor New Zealand Business News- Get more business news
Discuss this topic @ Share Investor Forum - Register free
Share Investor's Daily Forex Updates

Recommended Amazon Reading

The Snowball: Warren Buffett and the Business of LifeThe Snowball: Warren Buffett and the Business of Life by Alice Schroeder
Buy new: $13.60 / Used from: $11.85
Usually ships in 24 hours
The Intelligent Investor: The Definitive Book on Value Investing. A Book of Practical Counsel (Revised Edition)The Intelligent Investor: The Definitive Book on Value Investing. A Book of Practical Counsel (Revised Edition) by Benjamin Graham
Buy new: $14.95 / Used from: $10.44
Usually ships in 24 hours



Bookmark and Share

Saturday, January 2, 2010

STAR TELEGRAM: How Berkshire Hathaway's deal for BNSF played out

By ANDREA AHLES

Posted Thursday, Dec. 31, 2009

When Berkshire Hathaway announced Nov. 3 that it would buy Fort Worth-based Burlington Northern Santa Fe for $26 billion, it became clear that the first conversations about the deal took place during Berkshire Chief Executive Warren Buffett’s stay at a downtown Fort Worth boutique hotel 12 days earlier.

That Oct. 22 gathering at The Ashton was ostensibly for a meeting of the Berkshire Hathaway board, attended by Buffett, Microsoft founder Bill Gates and other company directors.

But a government filing made late last week discloses the details of just how quickly the world’s second-richest man put together the deal to acquire the 77.4 percent of BNSF that Berkshire didn’t already own.

The BNSF filing, which included voting instructions for BNSF shareholders who still must approve the deal at a Feb. 11 meeting in Fort Worth, also states that if the merger is not completed by June 30, either party can walk away.

On Dec. 7, the Federal Trade Commission said it found no antitrust issues, clearing the way for the acquisition to be completed in the spring.

Here’s a timeline, as recounted in the Securities and Exchange Commission filing:

Oct. 22 — Buffett meets with BNSF Chief Executive Matthew Rose and other BNSF executives before the Berkshire board meeting. At the meeting, the railroad’s "business and financial performance" is discussed.

Oct. 23 — Buffett and Rose meet in the evening. Buffett says that if the BNSF board is "receptive," Berkshire will buy all outstanding shares for $100 each. Berkshire already owns about 22 percent of the railroad. Buffett also details the financing of the deal: 40 percent in Berkshire common stock and 60 percent in cash, including an $8 billion loan.

Oct. 24 — Rose calls lead BNSF director Ed Whitacre to inform him of Buffett’s interest. Whitacre advises him to retain financial and legal advisers for BNSF.

Oct. 26 — A special board meeting is held via conference call to review the details of the potential purchase. Rose tells the board he has contacted Goldman Sachs and Evercore Partners as financial advisers. During the meeting, advisers inform the board that the "current state of the financial markets and BNSF’s market capitalization would make a superior proposal by a private-equity buyer unlikely." The regulatory analysis also notes that Berkshire holds investments in at least two other rail carriers.

Oct. 27 — Rose calls Buffett to tell him that the board met the day before and is "still considering the matter." He asks Buffett about Berkshire’s other rail investments. Buffett replies that he is willing to sell all Berkshire’s shares in other railroads.

Oct. 28 — The BNSF board holds another telephone conference and considers contacting other potential acquirers. After "extensive discussion," the board authorizes Rose to enter negotiations with Berkshire. Later that day, Rose calls Buffett and asks whether he would increase the offer above the $100 per share. Buffett tells Rose that the offer is at the very top of the range he is willing to pay.

Oct. 29 — A draft merger agreement is circulated between the companies.

Oct. 30 — BNSF and Berkshire execute a confidentiality agreement and begin negotiating terms of the merger.

Oct. 31 — The Compensation and Development Committee of the BNSF board holds a special meeting via telephone to discuss how the transaction will affect employee benefit plans.

Nov. 2 — The BNSF board holds a special meeting in Detroit to review and discuss the merger. "After engaging in extensive discussion, the BNSF board unanimously approved the merger agreement as being in the best interests of BNSF and its stockholders."

Nov. 3 — The companies announce that Berkshire will buy the outstanding shares of BNSF for $26.3 billion.


Share Investor Links

Share Investor Blog - Stockmarket & Business commentary
Share Investor New Zealand Business News- Get more business news
Discuss this topic @ Share Investor Forum - Register free
Share Investor's Daily Forex Updates

Recommended Amazon Reading

Warren Buffett and the Interpretation of Financial Statements: The Search for the Company with a Durable Competitive AdvantageWarren Buffett and the Interpretation of Financial Statements: The Search for the Company with a Durable Competitive Advantage by Mary Buffett
Buy new: $16.47 / Used from: $15.70
Usually ships in 24 hours
The Essays of Warren Buffett: Lessons for Corporate America, Second EditionThe Essays of Warren Buffett: Lessons for Corporate America, Second Edition by Warren E. Buffett
Buy new: $26.10 / Used from: $33.05
Usually ships in 24 hours

From Amazon - Apple iPod touch 32 GB (3rd Generation) NEWEST MODEL

Bookmark and Share

Wednesday, December 9, 2009

STAR TELEGRAM: Agency finishes review of Berkshire’s BNSF buyout


OMAHA, Neb. — The announced $26.3 billion buyout of Fort Worth-based Burlington Northern Santa Fe Corp. is a step closer to completion.

Warren Buffett’s Berkshire Hathaway said Monday that the Federal Trade Commission has ended an antitrust review of its proposed deal to acquire the big railroad operator. The companies said they expect the transaction to close in the first quarter of next year.

In early November, Berkshire agreed to pay $100 a share in cash and stock for the 77.4 percent of BNSF shares that it didn’t already own. The purchase would be the largest ever for Buffett’s holding company, based in Omaha.

Burlington Northern owns BNSF Railway Co., which operates 32,000 miles of track in 28 states and two Canadian provinces. It is a major hauler of grain, coal and consumer products.

Berkshire built its stake in Burlington Northern over the past two years before announcing plans to buy the entire company. Berkshire has scheduled a Jan. 20 special meeting in Omaha where shareholders will be asked to approve a 50-for-1 split of Berkshire’s Class B stock to complete the deal.

Buffett, who oversees Berkshire’s collection of insurance, energy and consumer goods businesses, is taking on debt and drawing down cash holdings to finance what he calls an “all-in wager” on the U.S. economy. Berkshire revealed in regulatory filings last month that it would sell stakes in competing railroad companies Union Pacific Corp. and Norfolk Southern Corp., and Buffett has since said that those shares have been sold.

Burlington Northern shares (ticker: BNI) rose 9 cents to $98.75 in light trading Monday. Berkshire’s Class B shares (ticker: BRK-B) slipped $4.66 to $3,315.34.

JPMorgan Chase & Co. and Wells Fargo & Co. are arranging an $8 billion loan for Berkshire to help finance the takeover. Berkshire has reported two straight quarterly profit increases.

The deal is the subject of legal skirmishing in Texas and Delaware as lawyers representing shareholders argue whether Buffett’s offer is high enough. More than a dozen attorneys gathered last week in the Tarrant County courtroom of state District Judge Dana Womack for one in a series of hearings on how and where the cases will go forward.

It’s expected that by the end of this week’s end, the four cases in Tarrant County, three in Dallas County and five in Delaware will be consolidated into one class-action lawsuit, lawyers said.

Staff writer Bob Cox contributed to this report, which contains material from The Associated Press.

Share Investor Links

Share Investor Blog - Stockmarket & Business commentary
Share Investor New Zealand Business News- Get more business news
Discuss this topic @ Share Investor Forum - Register free
Share Investor's Daily Forex Updates

Recommended Amazon Reading

The Warren Buffett Way, Second EditionThe Warren Buffett Way, Second Edition by Robert G. Hagstrom
Buy new: $9.72 / Used from: $4.73
Usually ships in 24 hours
The Tao of Warren Buffett: Warren Buffett's Words of Wisdom: Quotations and Interpretations to Help Guide You to Billionaire Wealth and Enlightened Business ManagementThe Tao of Warren Buffett: Warren Buffett's Words of Wisdom: Quotations and Interpretations to Help Guide You to Billionaire Wealth and Enlightened Business Management by Mary Buffett
Buy new: $15.61 / Used from: $4.50
Usually ships in 24 hours

Kindle 2/Kindle DX: Amazon's New Wireless Reading Devices (Latest Generation)

Bookmark and Share