In his recent presentation to CFA Society India, Tom Russo discussed the benefits of selling your business to Berkshire Hathaway. Here’s an excerpt from the presentation:
I would say that what it means in general is that Berkshire may be better off in its goal of fulfilling its promise over the next decades because the tension that you describe can be relieved by selling your business to Berkshire.
Because inside Berkshire what we look for doing ourselves in finding outside businesses that sacrifice the current for long-term, that’s happening all day long inside Berkshire, and some of these business that might have the risk, have the capacity to reinvest a sizable amount, but their risk in doing so will expose them to the agency or governance issues.
Those can be solved discreetly and quietly inside Berkshire as it was done with GEICO’s rise from 1 to 13 million policies. It never even showed up as an issue inside those reported profits.
So I think it’s actually good for Berkshire long-term as it will help them.
You can watch the interview here:
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