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Berkshire Hathaway's future is "pretty rosy" even without Warren Buffett



With Warren Buffett reappearing at the Berkshire Hathaway Annual General Meeting (BRK-A, BRK-B), it is only natural that questions arise about his succession and what this could mean for the future of the company

] In discussions with shareholders and Buffett observers, many believe that the 88-year-old investment legend has built a company and culture that will last long after he dies.

For beginners, he developed a deep bank talent when it comes to Berkshire Hathaway leadership. In early 2018, Buffett assigned Ajit Jain with responsibility for all insurance activities of Berkshire Hathaway and Greg Abel for all other operations.

"These steps were overdue," Buffett wrote in his annual letter. "Berkshire is far better now than when I was monitoring operations alone, Ajit and Greg have rare talents, and Berkshire blood flows through their veins."

<p class = "Canvas Atom Canvas Text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm" type = "text" content = " [ [19659005] Click here to read the coverage of the Berkshire Hathaway 2019 Shareholders' Meeting].] "data-reactid =" 19 "> [ Click here to the coverage of the Berkshire Hathaway shareholders' meeting 2019 .

On the investment side, Buffett's two young lieutenants, Todd Combs and Ted Weschler, each manage $ 13 billion of Berkshire's massive $ 173 billion equity portfolio and have "total discretion" in investment decisions.

Lawrence Cunningham, author of "" Berkshire Beyond Buffett, "is confident about the future of the investment and insurance conglomerate due to the talent at Berkshire and its subsidiary c.

" It's an amazingly talented group of people , Everyone believes Warrens is a one-man show in Berkshire, but this book shows that there are hundreds of highly talented people he trained, nurtured, and brought with them, "Cunningham told Andy Serwer during a panel on the US Yahoo Finance Forum on Friday.

Cunningham added that when he talks to Abel, he often thinks he's talking to Buffett himself. "19659016 Berkshire Hathaway Energy CEO Gregory Abel, center, listens as President Barack Obama during a meeting with White House leaders speaking in Washington, Monday, October 19, 2015. (AP Photo / Pablo Martinez Monsivais) "class =" JsEnabled_Op (0) JsEnabled_Bg (n) Trsdu (.42s) Bgr (no ) Bgz (cv) StretchedBox W (100%) H (100%) ie-7_H (a) "itemprop =" url "style =" background-image: url (https://s.yimg.com/ny/api /res/1.2/JJMF.h4jFVurjVY4s9y_gA–~A/YXBwaWQ9aGlnaGxhbmRlcjtzbT0xO3c9ODAw/https://img.huffingtonpost.com/asset/5ccd036524000068003c5192.jpeg); " src = "https://s.yimg.com/g/images/spaceball.gif" data-reactid = "28" />

Gregory Abel, chairman of Berkshire Hathaway Energy, listens to President Barack Obama during a meeting with business leaders speaks at the White House in Washington, Monday, October 19, 2015. (AP Photo / Pablo Martinez Monsivais)

An investment by Buffett is a vote of confidence, especially in times of financial stress, in which companies require a lifeline While capital can be crucial, the name Buffett has important justification.

"That's obviously the one big thing you lose, right, if Charlie and Warren are not around, that's kind of market power." UBS analyst Brian Meredith said during the forum.

However, Meredith predicted that Buffett would train the young MEPs to fill that role.

"You are developing all these connections and Warren is super smart and he knows how to advise people, and he does that now to bring them into that position if you have a situation like a financial crisis or whatever , you know, or an investment banker on Wall Street knows, 'Ah, I can call Todd, or I call Ted, or I can call Ajit,' Right? Boom, first call. "

Another important attribute of Buffett's ability to quickly put together a deal.

" Besides, I'm sure he's "training" so they have the ability to handle this transaction to reverse within 24 hours h said. "This is another very unique thing about Warren Buffett and Berkshire Hathaway, I mean, if a banker runs into a situation and has to find a deal or raise funds in 24 hours, it's not easy to do right, right Warren are doing so very quickly. "

During the forum, value investor Tom Russo, managing director of Gardner Russo & Gardner, also referred to Buffett's commitment to preserving culture when Berkshire acquired a company. This investment approach will likely continue without Buffett.

Ajit Jain, head of Berkshire Hathaway's reinsurance business, left the company to speak with Bill Gates, chairman and founder of Microsoft Corp., and the director of Berkshire Hathaway Inc. while they play on the sidelines Bridge of Berkshire Hathaway stockholders in Omaha, Nebraska, USA, on Sunday, May 4, 2014. (Daniel Acker / Bloomberg on Getty Images)

"Everyone knows that you can sell a business to private equity, but the contract that private equity has with its investors is that they want to recapture their money over a relatively short, short period of time," Russo said at a Forum forum "If someone wants to preserve the culture and quality and character of the company they've built their lives for, there's really only one place to sell this business

This approach, says Russo, allows Buffett to buy better companies at lower prices because "big companies do not want to sell to a private equity firm that is swiftly responsible for destroying what they do

"With this feature, paired with two new vice chairmen Greg and Ajit, both of whom are excellent, the best in the world in these areas, and these two investors Todd and Ted, how brilliant, I find that the future is pretty rosy. "

<p class =" canvas atom canvas-text Mb (1.0 em) Mb (0) – sm Mt (0.8em) – sm "type =" text "content =" Julia La Roche is a financial reporter at Yahoo Finance. Follow her on Twitter . "data-reactid =" 78 "> Julia La Roche is a financial reporter at Y ahoo Finance. Follow her on Twitter .


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