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Saturday, December 18, 2010

BLOOMBERG: Wells Fargo Surpasses JPMorgan Chase as Largest U.S. Bank by Market Value

Wells Fargo & Co., the San Francisco-based lender that doubled its size by buying Wachovia Corp. during the credit crisis, passed JPMorgan Chase & Co. to become the largest U.S. bank by stock-market value.

Wells Fargo’s market capitalization rose to $157.6 billion at the close of New York trading yesterday, surpassing JPMorgan’s $156.4 billion. Wells Fargo is ranked fourth by assets and deposits, while JPMorgan is second behind Bank of America Corp. and New York-based Citigroup Inc. is third.

Chief Executive Officer John Stumpf, 57, has used acquisitions to fuel growth at Wells Fargo. The lender completed more than 55 purchases in the past five years, led by its $12.7 billion takeover of Wachovia in October 2008, according to data compiled by Bloomberg. Wells Fargo had $622.4 billion in assets in the quarter before it purchased Wachovia. It held $1.2 trillion in assets at the end of September.

Wells Fargo rose 0.8 percent yesterday to $30.02 at 4 p.m. in New York Stock Exchange composite trading. The shares have advanced 11 percent this year, compared with a loss of 4 percent at JPMorgan. The biggest shareholder in Wells Fargo is Warren Buffett’s Berkshire Hathaway Inc. with a 6.4 percent stake.

Wells Fargo, the largest U.S. mortgage lender, had outperformed peers through Oct. 21 in part because it faces fewer mortgage-repurchase demands from Fannie Mae, Freddie Mac and private investors, FBR Capital Markets Corp. analysts led by Paul Miller wrote in a report that day.

Repurchase Demands

A month later, in a Nov. 29 report, Miller said repurchase demands combined could cost financial institutions $54 billion to $106 billion. Any total losses suffered by Wells Fargo will be outpaced by those at JPMorgan and Bank of America, Miller estimated.

Yesterday wasn’t the first time Wells Fargo has been the top bank by market value. On May 12, Wells Fargo passed Bank of America as the most valuable U.S. bank before the Charlotte, North Carolina-based company passed it on May 18, according to data compiled by Bloomberg.

New York-based JPMorgan has held the lead for most of the last two years, except for the five-month period between February and July of this year when it repeatedly traded places with Bank of America.

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Thursday, December 16, 2010

CNBC: Mr. Buffett Goes to the White House ... Again

Published: Tuesday, 14 Dec 2010 | 12:51 PM ET
By: Alex Crippen
Executive Producer

For the second time this year, Warren Buffett has met with President Obama in the White House's Oval Office.

The session this morning (Tuesday) also included Bill and Melinda Gates.

According to a brief White House statement, Mr. Obama invited the trio to the White House discuss the Giving Pledge, "the initiative they launched earlier this year that invites the wealthiest individuals and families in America to commit to giving the majority of their wealth to philanthropy."

The statement goes on to say the conversation also covered "ideas for growing the economy and making America more competitive including investment in education to better prepare the next generation and investing in innovative areas with opportunity for growth."

In July, Buffett met with President Obama in the Oval Office to "discuss the economy and our ongoing efforts to work with the private sector to stimulate growth and create jobs."

During that visit, the president noticed that Buffett's tie was frayed, and gave him a new, gift-wrapped, red tie.

No word on whether Buffett wore that gift today, or if he put on another disreputable tie in hopes of getting a second free piece of neckwear.

Current Berkshire stock prices:

Class B: [BRK.B 79.68 -0.56 (-0.7%) ]

Class A: [BRK.A 119487.0 -713.00 (-0.59%) ]


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MARKETWATCH: GE to buy back Buffett preferreds next year

By Alistair Barr, MarketWatch

SAN FRANCISCO (MarketWatch) — General Electric Co. Chief Executive Jeff Immelt said Tuesday that the company plans to buy back preferred securities it sold to Warren Buffett’s Berkshire Hathaway Inc. at the height of the financial crisis.

Immelt also defended what he described as a powerful “trilogy” of rising dividends, stock buybacks and acquisitions as investors pushed the CEO to return more of GE’s spare capital to shareholders.

Fed keeps policy unchanged

Fed officials maintained their policy of buying U.S. Treasury bonds and keeping short-term interest rates near zero amid signs the recovery is gathering some steam. But with some signs of growth, will the Fed pull back? Jon Hilsenrath and Matt Phillips discuss.

GE /quotes/comstock/13*!ge/quotes/nls/ge (GE 17.44, -0.25, -1.41%) was hit hard by the 2008 financial crisis as the company’s financial-services business, GE Capital, suffered big loan losses. The company had to lean on a U.S. government-backed program to borrow more than $50 billion to meet funding needs.

GE also raised $8 billion in late 2008 by selling preferred stock to Berkshire Hathaway /quotes/comstock/13*!brk.a/quotes/nls/brk.a (BRK.A 119,397, -803.00, -0.67%) /quotes/comstock/13*!brk.b/quotes/nls/brk.b (BRK.B 79.68, -0.56, -0.70%) . Read about Buffett’s investments in 2008.

Since then, the global economy has recovered, thanks to trillions of dollars in government bailouts and stimuli. That’s helped many of GE’s businesses rebound — especially GE Capital.

Immelt said Tuesday that GE Capital may be able to pay dividends to the parent company by 2012. Add in higher free cash flow generated by GE’s other businesses and the company could have more than $30 billion in cash by 2013, he added.

This level of cash includes increased dividends and share buybacks in coming years, Immelt noted. It also includes the repurchase of Berkshire’s preferred securities which will happen no later than October 2011, the CEO said.

Dreaming about cash

Some GE investors on Tuesday expressed concern that GE might sit on a cash pile of more than $30 billion, or plow it into a lot of acquisitions that might be difficult to integrate.

“We’re all kind of on edge about where this cash is going to go,” one investor said during the question and answer part of GE’s presentation.

Immelt said the $30 billion projection for 2013 was only conceptual.

“We are not going to let it go to $30 billion,” he added, while noting that the idea was to let investors “dream about... all that cash.”

‘Punch’

Still, the CEO said GE will continue to pursue acquisitions, as well as dividends and share buy backs.

“That trilogy is powerful,” Immelt added, while stressing that GE will focus on smaller, strategic, “bolt-on” acquisition with low execution risk.

If GE did a big, high-risk acquisition, “you could just punch me in the nose,” Immelt added.

GE shares rose 7 cents to close at $17.69 on Tuesday. The stock is up 17% so far this year, while the Standard & Poor’s 500 index has gained 11.3%.

Alistair Barr is a reporter for MarketWatch in San Francisco.

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Tuesday, December 14, 2010

BUSINESSWEEK: Berkshire Adds 3,000 Workers After Buffett Slashed Jobs in 2009

December 10, 2010, 12:02 AM EST

By Andrew Frye

Dec. 10 (Bloomberg) -- Berkshire Hathaway Inc. added about 3,000 jobs this year as Chief Executive Officer Warren Buffett invested in the firm’s biggest employer, railroad Burlington Northern Santa Fe, after slashing the workforce in 2009.

Berkshire has 260,000 employees across more than 70 subsidiaries spanning insurance, energy, freight hauling and luxury travel, according to a regulatory filing yesterday from the Omaha, Nebraska-based company. That’s up from the 257,100 workers at Berkshire and Burlington Northern at the end of 2009, when the railroad was an independent company.

Buffett, 80, bought Burlington Northern in February in what he called a bet on a U.S. economy emerging from the biggest financial crisis since the Great Depression. Berkshire cut more than 20,000 jobs last year as results at its manufacturing and housing businesses suffered. The economy expanded 2.5 percent in the third quarter after growing 1.7 percent in the second. Unemployment remains near a 26-year high.

“With the weak economy I guess it’s relatively good that employment went up 1 percent,” said David Kass, a professor at the University of Maryland’s Robert H. Smith School of Business. “That would indicate stability in the Berkshire Hathaway companies.”

Berkshire’s Class A shares declined $25 to $120,750 in regular trading yesterday on the New York Stock Exchange. The shares have climbed about 22 percent this year, compared with the 11 percent gain for the Standard & Poor’s 500 Index.

Adding Workers

Buffett told shareholders in May that Berkshire subsidiaries were adding jobs and that businesses serving broad industries, like railroads, were leading the advance. Fort Worth, Texas-based Burlington Northern, the second-biggest U.S. railroad behind Union Pacific Corp., had 35,000 employees at the end of 2009, down from 40,000 a year earlier.

The U.S. unemployment rate rose to a seven-month high of 9.8 percent in November as payroll growth slowed, the Labor Department said last week. Hours worked and earnings stalled, while a record 6.4 million women in the labor force were without work last month. Joblessness stood at a 26-year high of 10.1 percent in October 2009.

“We’re inching forward, we’re not galloping forward,” Buffett said in remarks recorded for an October conference outside Tel Aviv. “The worst is behind us, but the pain will be felt for a long time from what happened.”

Burlington Northern, headed by CEO Matthew Rose, contributed $706 million to Berkshire’s earnings in the third quarter, compared with the $488 million of net income it posted a year earlier as an independent company. The railroad planned to invest more than $2.5 billion in capital and equipment this year, Buffett said in September at the Montana Economic Development Summit.

Berkshire’s apparel maker Fruit of the Loom had about 27,000 workers and carpet maker Shaw Industries employed 25,500, according to the 2009 annual report from Buffett’s firm.

--Editors: Dan Reichl, Peter Blumberg


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CHICAGO TRIBUNE: Warren Buffett's new money manager favors financial stocks

Todd Combs' fund also had stakes in Chicago companies

December 11, 2010|By Becky Yerak, Tribune reporter

What did billionaire Warren Buffett see in Todd Combs? And what did Combs see in Chicago?

If the Berkshire Hathaway Inc. chief executive looked at the quarterly reports of the 39-year-old hedge fund manager he recently named to invest a chunk of his money, the Oracle of Omaha saw that Combs has a thing for financial stocks.

A couple of Chicago names even received a seal of approval in recent quarters from the Greenwich, Conn.-based investor now considered a possible successor to Buffett.

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Castle Point Capital Management LLC's $224.5 million portfolio has been overwhelmingly invested in commercial and investment banks, financing companies, credit card providers and insurers.

In recent quarters, Castle has held stakes in CME Group Inc. and MB Financial Inc., according to the firm's two latest Securities and Exchange Commission filings.

In the second quarter ended June 30, Castle held $14.4 million in CME stock, making it the fifth-biggest holding in that period by dollar value.

But by the third quarter ended Sept. 30, the fund had dumped all 51,000 shares of the Chicago-based exchange company, according to a Castle filing last month with the SEC. A CME spokesman declined to comment.

Other companies it completely disposed of included Hartford Financial Services Group.

Castle also lightened its positions in many of the companies in its portfolio, including MB Financial. As of Sept. 30, it had a stake valued at $6.5 million, representing 0.7 percent, or 400,000 shares, of the Chicago-based bank's stock.

A new stock added in the third quarter was America's Car-Mart Inc.

As of Sept. 30, Castle held stakes in a number of familiar names in the financial industry: Goldman Sachs Group Inc., JPMorgan Chase & Co., MasterCard Inc., PNC Financial Services, Progressive Corp., Charles Schwab Corp., State Street Corp., Wells Fargo & Co. and Western Union Co.

Its biggest stock investment, valued at $21.6 million, was US Bancorp.

In the second quarter, Castle owned 27 stocks with a total value of $279.7 million.

By the end of the third quarter, the fund held 24 stocks valued at $224.5 million.

On Oct. 25, Combs accepted Buffett's offer to manage part of Berkshire's investment portfolio.

On Friday, Castle Chief Financial Officer Andrew Turchin said the fund is now 100 percent in cash and has returned 90 percent of its capital to investors. He said third-quarter pruning was due to "changes in the investment thesis" and not in anticipation of any winding down due to Combs' new job.

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Friday, December 10, 2010

CNBC: 26-Year-Old Facebook Co-Founder Mark Zuckerberg Joins Buffett's Giving Pledge: 'Why Wait?'

Published: Thursday, 9 Dec 2010 | 11:40 AM ET
By: Alex Crippen
Executive Producer

Mark Zuckerberg, co-founder and CEO of Facebook
AP
Mark Zuckerberg, co-founder and CEO of Facebook

Another 17 individuals or families have joined Warren Buffett's "Giving Pledge," including the 26-year-old co-founder and CEO of Facebook.

The news release early this morning emphasizes that Mark Zuckerberg's youth contradicts with the more familiar image of a wealthy person turning to philanthropy later in his or her life.

He's quoted as saying:

"People wait until late in their career to give back. But why wait when there is so much to be done? With a generation of younger folks who have thrived on the success of their companies, there is a big opportunity for many of us to give back earlier in our lifetime and see the impact of our philanthropic efforts."

Zuckerberg is number 36 on the latest Forbes ranking of the 400 richest Americans, with an estimated wealth of $6.9 billion as of September. The year before his wealth was estimated at $2 billion.

But, as the Wall Street Journal notes in its coverage of the new pledges, since Zuckerberg's wealth is from "his ownership state in a company that has yet to list on the stock market, much of that wealth is theoretical at this point."

Also on the December pledge list: Carl Icahn and Michael Milken.

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BUSINESSWEEK: Berkshire’s Howard Buffett Appointed by Coca-Cola to Board

By Andrew Frye

Dec. 9 (Bloomberg) -- Berkshire Hathaway Inc.’s Howard Buffett has been named to the board of Coca-Cola Co., a post previously held by his father Warren Buffett, who controls a stake of more than 8 percent of the soft-drink maker.

Howard Buffett will serve on the company’s Public Issues and Diversity Review Committee, Atlanta-based Coca-Cola said today in a statement distributed by Business Wire. Buffett, 55, is also a director at Berkshire and has been designated by his father as a likely successor as chairman of the Omaha, Nebraska- based company.

--Editor: Dan Kraut

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Thursday, December 9, 2010

WHARTON JOURNAL: We’re Off to See the Oracle, the Awesome Oracle of Omaha

Warren Buffett Trek

By ROHIT BHAT (WG '12)

Published: Sunday, December 5, 2010

Updated: Sunday, December 5, 2010 11:12

The Nebraska Furniture Mart! I felt like a pilgrim taking his first step into a holy shrine. I was the lucky first year to be selected to go on the Warren Buffett trek in Omaha in November 2010 and the Mart was our first pit stop. We were shown around the store, one of Mr. Buffett's first investments, by Exec-VP Bob Batt, a grandson of Rose Blumkin, the legendary founder of the company. "We've never been asked to merge with Berkshire's other stores", he remarked as he described the autonomy given to Mr. Buffett's operating CEOs.

A short tour and bus ride later, we reached Kiewit Plaza, the home of Berkshire Hathaway. Mr Buffett entered the hall to a roaring standing ovation. The hall resonated for five minutes before the audience finally let the messiah of investing speak in his own church. For the next two and a half hours, I entered a timeless, dream-like world as I listened to Mr. Buffett answering questions, reaching back for some of his old nuggets of wisdom on investing and producing some new ones on philanthropy and life.

He described the human brain as the most underutilized investing resource. He remarked that generating one's own ideas through hard work and thinking was the only path to investment success. He thumbed through a copy of a Moody's manual and described how he went through its 10,000 pages to find Western Insurance Securities.

When asked about Todd Combs, Mr. Buffett said "Todd fits Berkshire and Berkshire fit Todd." He added that Todd would make Berkshire his life-long home and that they saw eye to eye on investing as well as incentives.

He was then asked to describe his toughest moral decision. He answered that it was the decision he once made with Charlie Munger that "we didn't want to manufacture tobacco". He recognized the fact that companies he owned and invested in distributed and retailed tobacco and that people had free will – yet, he didn't want to be further involved with the substance. He admitted that it wasn't a perfect answer but it was one he was comfortable with. He added, "You will have to find your own limits."

Describing what he looked for in a business, he remarked that he wanted people who "paint the painting because they love it." His own life so far reflected this – he wanted to paint his own picture and receive applause for it. For his CEOs, "I will provide the applause."

On his views on philanthropy, Mr. Buffett said that giving away his money was really the best use for it. He joked that he could probably put Egypt out of business if he were to build a tomb for himself, but he wanted to create as much impact as possible per dollar used. That was why he had given away most of his money to the Bill and Melinda Gates Foundation. He also talked about his work along with the Gates family to convince other billionaires to pledge away at least half their money to charity. The pledges can be looked up on givingpledge.org.

Finally, and quite surprisingly, he talked about his children as the achievement he was most proud of. He talked a number of times through the Q&A on the subject, mentioning that he had not met any parent who was happy in life without being happy with how their kids turned out or vice versa.

I have always been awestruck by the intellectual generosity of Warren Buffett. He follows truly in the footsteps of his mentor, Benjamin Graham, who also shared his investing philosophy with others, knowing full well that he has been creating competition for himself. What I was even more astounded by was his generosity of his time. After spending two and a half hours talking, he took us to lunch to his favorite restaurant, Piccolo's. Here, he spent two hours taking photos with us (in some crazy postures, I might add) without eating a morsel.

We finally bid goodbye and flew out of Omaha after a brief stop at Borsheim's, Berkshire's renowned jewelry store. Meeting Warren Buffett was a lovely experience, one our group will cherish forever. And if you see any of us smiling, we're probably still thinking of following the yellow brick road to Omaha.

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HOUSTON CHRONICLE: Buffett provides a lesson for UH students

By HIBA ADI Copyright 2010 Houston Chronicle

Dec. 3, 2010, 11:04PM

photo
UH Bauer College

The students joined Warren Buffett at one of his favorite restaurants in Omaha, Neb.

Entrepreneurship students from the University of Houston got a rare opportunity to spend a weekend in Omaha, Neb., meeting and talking with one of the world's most successful investors, Warren Buffett.

"The energy he has is amazing," said undergraduate Mahnaz Cinquegrana, who attended the retreat last month. "He's very warm and friendly."

Cinquegrana was one of 20 students selected to represent UH's Bauer College of Business. She described the experience as "priceless."

This was UH's second year to be invited to the Buffett retreat. It was one of six schools — and the only school in Texas - chosen.

Arthur Warga, dean of the Bauer College, said participants were chosen based on grade-point average.

The students visited Berkshire Hathaway headquarters and got to take part in a two-hour question-and-answer session with the investor.

Buffett, 80, the Berkshire CEO known as the "Oracle of Omaha," also joined the students for dinner at one of his favorite restaurants. He shared jokes and took pictures with the students.

During the Q&A, Cinquegrana asked Buffett about his recent selection of a relatively unknown successor candidate, 39-year-old Todd Combs.

Not just money

Buffett said he wanted someone interested in more than just making money.

"That's why he goes for small businesses that started with nothing and grew. That's what appeals to him," Cinquegrana said. "He wants the owner of the business to stay there, not go in there and replace everyone once it grows."

Another UH participant, MBA student Aimee Langlinais, said she was impressed with Buffett's admonishment to invest in people, not businesses.

"I think that entrepreneurs should always remember that focusing on the best interest of the people they affect every day, whether that be their employees, shareholders or the community, will drive profits," Langlinais said. "What they decide to do with those profits speaks to their character."

With a net worth estimated at $47 billion, Buffett repeated his recent mantra to students - that people with more than $1 billion in net worth should donate at least half of their money to charity.

Close ties to UH

Warga said Buffett has visited UH in the past. He cited Buffett's close relationship with Melvyn Wolff, chairman of the Berkshire Hathaway-owned Star Furniture and namesake of the Cyvia and Melvyn Wolff Center for Entrepreneurship at UH, in strengthening the ties.

"It means a lot to us," he said. "Mr. Buffett has interacted with our students more than any other university.

"When people hear he's the wealthiest person in the world, they may begin to stereotype. But when you meet him, you realize he's very humble and as far away from materialism as you can get. It sets an example for anyone, whether they're entrepreneurs or not."


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BLOOMBERG: Buffett’s Railroad Should Shun Mexican Inspections, Unions Say

Warren Buffett’s Burlington Northern Santa Fe Corp. railroad shouldn’t be allowed to have its trains inspected in Mexico instead of the U.S., labor unions said.

The railroad, part of Buffett’s Berkshire Hathaway Inc., is asking U.S. regulators for permission to move U.S.-Mexico border inspections, saying facilities in Mexico are better and that equipment reviews there match the quality on the U.S. side.

Moving the inspections to Mexico would cost U.S. jobs and jeopardize safety, labor unions said in comments filed this week with the Federal Railroad Administration. Divisions of the AFL- CIO, the Transportation Communications International Union and the Teamsters were among groups that commented.

“Once you allow as a matter of government policy to have these trains inspected in Mexico, then it’s just a matter of time when all the cross-border train business gets outsourced,” Edward Wytkind, president of the AFL-CIO’s transportation union, said today in a telephone interview. “It’s not just a threat to jobs. It’s a threat to the safety of the rail system.”

Burlington Northern, based in Fort Worth, Texas, wants to use Ferrocarril Mexicano SA de CV, the rail unit of Grupo Mexico SAB, to perform border inspections before trains cross into the U.S., according to a July 5 filing with the rail administration, which regulates railroad safety.

Spokesmen for Burlington Northern and the rail regulator didn’t immediately respond to phone calls seeking comment.


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Wednesday, December 8, 2010

BLOOMBERG: Berkshire Hathaway Hog-Products Unit Founder Howard Brembeck Dies at 100

Howard S. Brembeck, who founded the livestock and farming equipment maker that was bought by Warren Buffett’s Berkshire Hathaway Inc., has died. He was 100.

Brembeck died on Dec. 5, CTB Inc., the company he established in 1976, said today in a statement on its website. Brembeck retired from the Milford, Indiana-based firm in 1995.

Buffett said last year in an address to CTB employees that his 2002 acquisition of the unit was “a lucky day” for Omaha, Nebraska-based Berkshire. The company paid about $177 million for CTB, according to Bloomberg data, and Buffett bankrolled the unit’s expansion through at least six acquisitions, including the purchase of Porcon group of Deurne, the Netherlands. Buffett, 80, has pledged support for the firm’s expansion.

“We’ll hit a bump in the road every now and then but we’re looking at a superhighway out there in front of us,” Buffett told CTB staff in a video posted on the CTB website.

Brembeck began selling equipment for poultry and livestock farmers through Chore-Time, a CTB predecessor, in 1952, according to the company. He later added storage bins for commercial grains to his offerings. CTB’s hog products include pig feeders and ventilation fans.

“Howard created a legacy of innovation” said Victor Mancinelli, president and chief executive officer of CTB, in the statement.

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REUTERS: Verisk to buy privately held 3E for $110 million

Tue Dec 7, 2010 9:34am EST

n">(Reuters) - Verisk Analytics Inc (

VRSK.O), part-owned by Warren Buffett's Berkshire Hathaway (BRKa.N), said it will buy environmental health and safety firm 3E for $110 million, its second acquisition this month.

The insurance risk specialist expects the deal to be neutral to adjusted earnings in 2011.

Verisk said it will use cash on hand and funds from a revolving facility to finance the deal, expected to close in December.

The company -- which bought Medicare compliance firm, Crowe Paradis Services Corp, for $90 million earlier this month -- had about $107 million in cash as of Sept 30.

3E provides services that help companies comply with environmental health and safety needs relating to workplace and has more than 5,000 customers worldwide.

Shares of New Jersey-based Verisk, which have risen more than 9 percent in value since the company posted third-quarter profit above Wall Street view in November, closed at $31.92 on Monday on Nasdaq.

(Reporting by Archana Shankar in Bangalore; Editing by Jarshad Kakkrakandy)

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BUSINESSWEEK: Berkshire to Sell $500 Million in Notes to Repay Debt

December 07, 2010, 11:42 AM EST

By Sapna Maheshwari and Andrew Frye

(Updates with price guidance in second paragraph.)

Dec. 7 (Bloomberg) -- Billionaire investor Warren Buffett’s Berkshire Hathaway Inc. plans to sell $500 million of notes to repay debt used by its Clayton Homes manufactured housing unit.

The five-year senior notes may be issued through Berkshire Hathaway Finance Corp. as soon as today and may pay about 87.5 basis points more than Treasuries maturing at about the same time, according to a person familiar with the transaction, who declined to be identified because terms aren’t set. Proceeds will repay the finance arm’s existing 4.2 percent senior notes, the Omaha, Nebraska-based company said in a regulatory filing.

Buffett’s firm sells bonds in part to finance mortgages for people who buy Clayton’s factory-built housing. In a letter accompanying Berkshire’s 2009 annual report, Buffett said Berkshire will continue backing the home-loan program.

“Even today, though job-loss troubles have grown, Clayton’s delinquencies and defaults remain reasonable and will not cause us significant problems,” Buffett wrote.

The housing crisis and U.S. unemployment spurred Standard & Poor’s to cut its outlook on Clayton in April.

Installment loan balances held by Berkshire’s finance and financial products division, which includes Clayton, declined about 2 percent last year to $12.3 billion, according to Berkshire’s annual report.

Notes Coming Due

The finance arm issued $500 million of the 4.2 percent notes in December 2003, and then exchanged the debt for freely tradable securities in May 2004, according to data compiled by Bloomberg.

The notes due on Dec. 15 traded on Nov. 12 at 100.32 cents on the dollar to yield 0.122 percent, or 3.8 basis points less than similar-maturity Treasuries, according to Trace, the bond- price reporting system of the Financial Industry Regulatory Authority. A basis point is 0.01 percentage point.

Goldman Sachs Group Inc. is managing today’s offering, according to today’s regulatory filing. The filing didn’t specify the size, timing or maturity of the offering.

--Editor: Sharon L. Lynch, Pierre Paulden.


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Tuesday, December 7, 2010

CNBC: Warren Buffett: 'Pleasure' to Write $50M Check for Nuclear Fuel Bank

Published: Saturday, 4 Dec 2010 | 12:53 PM ET
By: Alex Crippen
Executive Producer

Warren Buffett
Getty Images
Warren Buffett

Warren Buffett likes to portray himself as the multi-billionaire cheapskate who feels great pain from every dollar bill that leaves his wallet.

But there's no sign today of that stingy public persona he sometimes exaggerates for laughs.

Buffett says in a statement from Sam Nunn and Ted Turner's Nuclear Threat Initiative that it will be a "pleasure" to write a $50 million check, fulfilling his promise to help fund an international nuclear fuel bank.

Back in 2006, Buffett offered the money if the UN's International Atomic Energy Agency could raise another $100 million from one or more countries around the world.

It took several years, but that goal was met and the IAEA formally voted yesterday (Friday) to create a multinational nuclear fuel bank that will serve as a reliable source of reactor fuel for nuclear power plants, so that countries won't have to make that fuel themselves.

As the Washington Post notes today, "The same centrifuges used to prepare uranium for power plants can also be used to enrich it to higher, weapons-grade levels."

That's why the U.S. and other countries are worried about Iran's efforts to make nuclear fuel, despite that country's assertions that it is only trying to make electricity.

Buffett says in the Post, "Essentially what we're saying to the world is, if you want to be in the peaceful use of nuclear power, you don't have to have those enrichment facilities."

In the NTI statement, Buffett (an advisor to the group) is quoted as saying, "The IAEA fuel bank is an investment in a safer world and an essential tool in reducing nuclear dangers. I believe that the fuel bank will help reduce the risk of enrichment proliferation globally. It will be a pleasure to write a check for funds that will help reduce global dangers.”

Buffett tells the New York Times, "I've never been $50 million lighter and felt better." He hopes the bank will at least partially put the nuclear "genie back in the bottle" because the "spread of weapons of incredible destructive capability is the No. 1 problem facing mankind."

In an interview with Reuters, Buffett says he may be contributing even more money to efforts to stop the spread of weapons of mass destruction:

"Throughout my lifetime I will be interested in this subject and I will back that interest up with money... If the project sounds like a good one and has any real chance of reducing the probabilities of the terrible use of nuclear, chemical and biological weapons I'm prepared to put up significant money... Something can come up that requires a million dollars or something can come up that requires a $100 million."

Calling the threat of WMDs the biggest problem facing mankind in the 21st century, Buffett said, "We really have to prevent weapons of tremendous potential harm being used by these people who have evil intentions ... this is not a problem that we can wish away."

Current Berkshire stock prices:

Berkshire Portfolio

Class B: [BRK.B 80.46 -0.44 (-0.54%) ]

Class A: [BRK.A 120698.0 -702.00 (-0.58%) ]


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