Buffett’s succession plan: Todd Combs joins Berkshire

In a news release announced on Monday, Warren Buffett’s Nebraska-based Berkshire Hathaway said that hedge fund manager Todd Combs would join Berkshire Hathaway as an investment manager to handle a significant position that would eventually lead the firm to manage and expand its portfolio. Berkshire Hathaway, at present, owns numerous businesses focused on the insurance sector and a huge amount of liquidity involved in stocks.

According to Warren Buffett, one of the world’s richest tycoons, the new yet unexpected move fits with the succession plan, which the 80-year-old has outlined for the company he owns and leads since 1965.

Buffett had addressed his succession agenda in May this year and as per his plan his position would ultimately be split into a CEO role that would be taken care of by three or four investment chiefs.

Since then there has been a speculation on the kind of recruitments Buffett’s Berkshire Hathaway would make.

Buffett made a significant statement in his company news release, he said that he and his business partner Charlie Munger looked for someone like Combs for three years and they finally found Combs, who will now handle a significant position of Berkshire Hathaway’s investment portfolio.

“We are delighted that Todd will be joining us,” added Buffett.

James Armstrong, owner of the Berkshire stocks and president of Pittsburgh-based Henry H. Armstrong Associates said, “The fact that he’s come public with one of the names means he must be pretty confident in Mr. Combs, or why release the name. It’s not been his practice.” Armstrong oversees $ 400 million.

Combs’ appointment news, however, was surprisingly revealed right after Berkshire disclosed a dispute with securities regulators over its accounting for investments.

Todd Combs: Fact File

39-year-old Todd Combs has been managing Castle Point Capital, a financial service, as a hedge fund manager since five years. Combs has reportedly been able to manage $ 395 million since the firm’s inception in November 2005 till July 2010 and his fund climbed 28% up during the mentioned period.

Combs issued a letter to the limited partners of Castle Point Capital after Berkshire’s announcement that he is joining them.

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Warren Buffett: Life Changing Lessons of Warren Buffet for Unlimited Success in Investing, Business and Life (Warren Buffett, warren buffett’s 3 favorite books, warren buffett biography)

Warren Buffett: Life Changing Lessons of Warren Buffet for Unlimited Success in Investing, Business and Life (Warren Buffett, warren buffett’s 3 favorite books, warren buffett biography)

Warren Buffett

Life Changing Lessons of Warren Buffet for Unlimited Success in Investing, Business and Life

If you are considering starting a business or placing an important investment, there is hardly a better way of heading towards guaranteed success than taking a word from a self-made billionaire who started his multiple billion company, basically out of nothing.

Life Changing Lessons from Warren Buffet for Unlimited Success in Investing, Business and Life is written as a compilation of gathered top advices of Mr. Warren Buffet, who is holding his place on the top of the world as one of the richest men alive, so if you are struggling with bad investments and poor business decisions, this business guide c


Warren Buffett’s Ten % Stake In Burlington Northern – What It May Mean To You

Warren Buffett’s Berkshire Hathaway has disclosed a greater than 10% stake in Burlington Northern Santa Fe (BNI). Through three insurance subsidiaries (Columbia, National Indemnity, and National Fire & Marine) Berkshire beneficially owns 39,027,430 shares of Burlington Northern common stock according to an SEC filing made on Friday, April 6, 2007.

Berkshire’s most recent reported purchase was made on Thursday, April 5th, and consisted of 1,219,000 shares purchased at $ 81.18 each.

Upon presenting the familiar table of Berkshire’s major investment in his most recent letter to shareholders, Buffett wrote:

“We show below our common stock investments. With two exceptions, those that had a market value of more than $ 700 million at the end of 2006 are itemized. We don’t itemize the securities referred to, which have a market value of $ 1.9 billion, because we continue to buy them. I could, of course, tell you their names. But then I would have to kill you.”

It appears that Burlington Northern was one of the two large positions Berkshire was accumulating. Clearly, Berkshire has been a big buyer of Burlington Northern shares since Buffett wrote his letter to shareholders, because Berkshire’s position now has a market value of approximately $ 3.2 billion.

The size of the investment will make it one of about a half dozen large positions held by Berkshire. This investment dwarfs most of Berkshire’s investments made during the past few years – it is already considerably larger than any other single investment recently disclosed by Berkshire including the investment in Posco (PKX), US Bancorp (USB), ConocoPhillips (COP), Anheuser Busch (BUD), Johnson & Johnson (JNJ), USG (USG), Wal-Mart (WMT), and Tesco (TSCDY).

Simply put, this is the biggest single common stock investment made by Berkshire in a long time.

It’s big news – and it seems to have caught most Buffett watchers off guard. GuruFocus, a site that tracks Buffett’s moves religiously, announced that its contest to name the two mystery investments alluded to in Buffett’s annual letter had failed to turn up any guesses that Burlington Northern would be among the pair.

Burlington Northern Santa Fe operates one of the largest rail systems in North America. The system includes 32,000 route miles of track of which 23,000 are owned route miles.

In recent years,  Burlington Northern Santa Fe has been buying back stock. The company expects share repurchases will remain the primary use of its free cash flow. In fact, Burlington Northern may allow “a moderately higher level of debt” so the company can “devote additional financial capacity to share repurchases”.

In that respect, at least, it is a typical Berkshire investment.

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Warren Buffett’s Most Memorable Newsmakers

Warren Buffett, the so-called Oracle of Omaha’s most recent $ 5 billion investment in a troubled Bank of America, is only the latest high-profile deed in Buffett’s long contrarian track record. Similarly, back in 2008, the investor also made a wise $ 5 billion investment in Goldman Sachs. Moreover, at the middle of this month, Warren Buffett urged U.S members of Congress to ‘Stop Coddling the Super Rich’. Here are seven of Warren Buffett’s most memorable newsmakers.

The 1964’s “salad oil scandal” ended up costing American Express approximately $ 58 million and much of its reputation and its stock quickly lost 50% of its value. Buffet took advantage of this opportunity; observed people beginning to use credit cards in their daily transactions, and recognized AXP’s potential to become an American blue chip to invest $ 1.28 billion in the company. Those shares are now worth more than $ 5 billion and Berkshire Hathaway currently owns 12.7% of American Express.

Warren Buffett decided to invest $ 1.28 billion in American Express in 1964

Taking advantage of the turmoil in the markets in 2008, the billionaire made a wise $ 5 billion investment in Goldman Sachs via a preferred purchase in which Buffett earned a hefty 10% dividend yield

In a 2010 interview, Billionaire investor Warren Buffett shared: ” We’re in a recession” when talking about the U.S. economy remains in recession

In July 2011, legendary self-made investor accused GOP-controlled House of Representatives of playing ‘Russian roulette’ and trying to ‘blow America’s brains out’ with their defiance on debt

At the early August 2011, Warren Buffett told Bloomberg Television’s Betty Liu S&P made a mistake and the United States deserved a “quadruple A” rating and repeated his view that the economy will avoid its second recession in three years.

Warren Buffett

Warren Buffett’s most memorable newsmakers: ‘Stop Coddling the Super Rich’ with low taxes

In the other word, the billionaire Warren Buffett demanded U.S. lawmakers to increase taxes on the country’s super-rich to help cut the budget deficit.

The latest event in August 2011 is his $ 5 Billion investment in Bank of America

Following this deal, Buffett’s holding company Berkshire Hathaway will buy 50,000 shares of Bank of America preferred stock at $ 100,000 a piece.


Warren Buffett’s Most Memorable Newsmakers: $ 5 Billion Investment in Bank of America


Related links:

Warren Buffett doesn’t Expect Double-Dip Recession

Warren Buffet: Best Investor

Most Typical International Newsmakers of the Year 2010

Jolie Crussel, an economic expert, is keen on analyzing the economic situations in the world. Currently, she often delivers lectures on economic solutions to students and provides advice for many firms.