| 
  • If you are citizen of an European Union member nation, you may not use this service unless you are at least 16 years old.

  • Get control of your email attachments. Connect all your Gmail accounts and in less than 2 minutes, Dokkio will automatically organize your file attachments. You can also connect Dokkio to Drive, Dropbox, and Slack. Sign up for free.

View
 

Berkshire-Hathaway

Page history last edited by PBworks 11 years, 11 months ago

Berkshire-Hathaway

 

Berkshire Hathaway (NYSE: BRKA, NYSE: BRKB) is a large holding company headquartered in Omaha, Nebraska, USA, that oversees and manages a number of subsidiary companies. Berkshire Hathaway's core business is insurance, including property and casualty insurance, reinsurance and specialty nonstandard insurance. The Company averaged a phenomenal 25%+ annual return to its shareholders for the last 25 years while employing large amounts of capital and minimal debt.

 

The company is controlled by Warren Buffett, who is one of the most celebrated investors in history and the second-richest man in the world according to Forbes magazine. Buffett has used the "float" provided by Berkshire Hathaway's insurance operations (a policyholder's money which it holds temporarily until claims are paid out) to finance his investments. In the early part of his career at Berkshire, he focused on long-term investments in publicly quoted stocks, but more recently he has turned to buying whole companies. Berkshire now owns a diverse range of businesses including candy production; retail, home furnishings, encyclopedias, vacuum cleaners, jewelry sales; newspaper publishing; manufacture of and distribution of uniforms; and manufacture, import and distribution of footwear.

 

Berkshire's Class A shares sell for over $100,000 a piece, making them the highest-priced shares on the New York Stock Exchange. This is because they have never had a stock split. On October 23, 2006 shares closed at $100,000 for the first time. 1

 

Berkshire's CEO, Warren Buffett, is respected for his investment prowess and his deep understanding of a wide spectrum of businesses. His annual chairman letters are read and quoted widely.

 

As of 2005, Buffett owns 38% of Berkshire Hathaway. Berkshire's Vice-Chairman Charlie Munger also holds a stake big enough to make him a billionaire, and early investments in Berkshire by David Gottesman and Franklin Otis Booth resulted in their becoming billionaires as well.

 

Berkshire Hathaway is notable in that it has never split its shares, which not only contributed to their high per-share price but also significantly reduced the liquidity of the stock. But despite its size, it is not included in broad stock market indexes such as the S&P 500. However, Berkshire Hathaway has created a Class B stock, with an ownership value of 1/30th of that of the original shares (now Class A) and 1/200th of the per-share voting rights. Holders of Class A stock are allowed to convert their stock to Class B, though not vice versa.

 

Buffett was reluctant to create the Class B shares, but did so to thwart the creation of unit trusts that would have marketed themselves as Berkshire look-alikes. As Buffett said in his 1995 shareholder letter:

 

"The unit trusts that have recently surfaced fly in the face of these goals. They would be sold by brokers working for big commissions, would impose other burdensome costs on their shareholders, and would be marketed en masse to unsophisticated buyers, apt to be seduced by our past record and beguiled by the publicity Berkshire and I have received in recent years. The sure outcome: a multitude of investors destined to be disappointed."

 

Berkshire's annual shareholders' meetings, taking place in the Qwest Center in Omaha, Nebraska, are routinely visited by 20,000 people.1 The meetings, known for their humor and light-heartedness, typically start with a movie made for Berkshire shareholders. The 2004 movie featured Arnold Schwarzenegger in the role of 'The Warrenator' who travels through time to stop Buffett and Munger's attempt to save the world from a "mega" corporation formed by Microsoft-Starbucks-Wal-Mart. Schwarzenegger is later shown arguing in a gym with Buffett regarding Proposition 13.2 The 2006 movie depicted actresses Jamie Lee Curtis and Nicollette Sheridan lusting after Munger.

 

 

Insurance and finance subsidiaries

GEICO

General Re

Kansas Bankers Surety Company

National Indemnity Company

Wesco Financial Corporation

Applied Underwriters Inc.

Medical Protective

 

Other subsidiaries

Xtra Lease

Borsheim's Fine Jewelry

Dairy Queen

Fruit of the Loom

Nebraska Furniture Mart

Jordan's Furniture

The Pampered Chef

See's Candies

World Book

FlightSafety International

NetJets

Forest River

Business Wire

Russell Corporation

ISCAR Metalworking

TTI Inc.

Mouser Electronics

Clayton Homes

 

see more: http://en.wikipedia.org/wiki/Berkshire_Hathaway

Comments (0)

You don't have permission to comment on this page.