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Berkshire Hathaway: Difference between revisions
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In 1962, Warren Buffett began buying Berkshire Hathaway stock for his fund, anticipating that as the company liquidated textile mills there would come a [[tender offer]] when he could sell the shares at a profit. A year later, Buffet and his associates became the largest shareholder of the company, eventually securing a 49% stake.<ref name=Grow/> In 1964, Stanton made an oral tender offer to buy back Buffett's stake in the company for $11.50 per share. Buffett agreed to the deal. A few weeks later, Warren Buffett received the tender offer in writing, but the tender offer was for only $11.375. Buffett later admitted that this lower, undercutting offer made him angry.<ref name=Worst>{{cite news | url=https://www.cnbc.com/2010/10/18/warren-buffett-buying-berkshire-hathaway-was-200-billion-blunder.html | title=Warren Buffett: Buying Berkshire Hathaway Was $200 Billion Blunder | first=Alex | last=Crippen | work=[[CNBC]] | date=October 18, 2010}}</ref> Instead of selling at the slightly lower price, Buffett decided to buy more of the stock to take control of the company and fire Stanton, which in 1965 he did. However, this left Buffett's fund with a major interest in a declining textile business. | In 1962, Warren Buffett began buying Berkshire Hathaway stock for his fund, anticipating that as the company liquidated textile mills there would come a [[tender offer]] when he could sell the shares at a profit. A year later, Buffet and his associates became the largest shareholder of the company, eventually securing a 49% stake.<ref name=Grow/> In 1964, Stanton made an oral tender offer to buy back Buffett's stake in the company for $11.50 per share. Buffett agreed to the deal. A few weeks later, Warren Buffett received the tender offer in writing, but the tender offer was for only $11.375. Buffett later admitted that this lower, undercutting offer made him angry.<ref name=Worst>{{cite news | url=https://www.cnbc.com/2010/10/18/warren-buffett-buying-berkshire-hathaway-was-200-billion-blunder.html | title=Warren Buffett: Buying Berkshire Hathaway Was $200 Billion Blunder | first=Alex | last=Crippen | work=[[CNBC]] | date=October 18, 2010}}</ref> Instead of selling at the slightly lower price, Buffett decided to buy more of the stock to take control of the company and fire Stanton, which in 1965 he did. However, this left Buffett's fund with a major interest in a declining textile business. | ||
While Buffett maintained Berkshire's core business of textiles, he gradually moved capital to other industries, beginning with the March 1967 acquisition of the [[National Indemnity]] group of companies, which include National Indemnity Company, National Liability & Fire Insurance Company, and National Fire & Marine Insurance company, among others. It was valued at $35 per share, but Buffett offered $50 per share for the company, or $8.6 million.<ref>{{Cite book | last=Lu | first=Yefei | title=Inside the Investments of Warren Buffett: Twenty Cases |publisher=[[Columbia University Press]] | isbn=978-0-231-16462-7 | location= | While Buffett maintained Berkshire's core business of textiles, he gradually moved capital to other industries, beginning with the March 1967 acquisition of the [[National Indemnity]] group of companies, which include National Indemnity Company, National Liability & Fire Insurance Company, and National Fire & Marine Insurance company, among others. It was valued at $35 per share, but Buffett offered $50 per share for the company, or $8.6 million.<ref>{{Cite book | last=Lu | first=Yefei | title=Inside the Investments of Warren Buffett: Twenty Cases |publisher=[[Columbia University Press]] | isbn=978-0-231-16462-7 | location=New York City | pages=69 | year=2016}}</ref> | ||
In 1963, [[Franklin Otis Booth Jr.]] invested $1 million in the company and in 1968, [[David Gottesman]] invested in the company. The investments made both individuals billionaires. | In 1963, [[Franklin Otis Booth Jr.]] invested $1 million in the company and in 1968, [[David Gottesman]] invested in the company. The investments made both individuals billionaires. | ||