Investors had speculated in recent years that Warren E. Buffett could eventually retire. But the 94-year-old billionaire still surprised many on Saturday, when he announced that he planned to resign As a chief executive of Berkshire Hathaway after almost six decades.
Less surprising is who he said he intended to follow him up as the leader of the $ 1.1 trillion conglomerate that he built: Gregory E. Abel, his years of heir clear.
Who is Greg Abel?
Since 2018, Mr. Abel, 62, vice-chairman of Berkshire’s non-care companies, the 189 operational companies that include the BNSF railway, is one of the largest in the nation; Berkshire Hathaway Energy, a gigantic energy company; Restaurant chains and retailers such as Dairy Queen and the Borsheims Jewelry Chain; Consumer brands such as Fruit of the Loom Underwear, Brooks running shoes and Justin Boot; Netjets, the private jet service; And more.
Mr Abel’s enormous responsibilities came after a steady rise due to the ranks of Berkshire. A resident of Edmonton, Alberta and an accountant through training, he joined the conglomerate in 2000 when Mr. Buffett bought a controlling interest in what Midamerican Energy was, where he was president.
Mr. Abel was appointed vice -chairman of Berkshire in 2018 and anoint him as a potential successor to Mr Buffett, a status that Mr Buffett confirmed in 2021. “The directors agree that if something happened tonight, it would be Greg who would take over it tomorrow morning,” Mr Buffett told CNBC at the time.
Apart from his work experience, Mr. Abel known for his love for hockey, which he played as a child: He is a voluntary coach For his son’s team in the Moines, where he lives and where Berkshire Hathaway Energy is based.
Why did he get the nod?
The relatively low-profile Mr. Over the years, Abel has won praise from Mr. Buffett and others in the Berkshire track for two important qualities.
The first is his operational expertise. He helped in leading a series of acquisitions that Midamerican – renamed Berkshire Hathaway Energy in 2014 – renamed a large electricity producer. Since his increase in 2018, he has supervised a much broader collection of companies that reported together More than $ 5 billion In the operational income in the first three months of this year.
Mr Buffett has praised his heir as an effective director he trusted to make great decisions. By 2023, Mr Buffett told CNBC, Mr. Abel “does all the work and I take all the arches.” The billionaire added: “He is a major improvement of me, but tells no one.”
The other quality of Mr. Abel is that he is seen as fitting the Berkshire form. He became a more serious competition to take over the conglomerate in 2011, when David Sokol, his former boss at Midamerican who was known as the most important fixer of Mr Buffett, resigned. Berkshire had concluded Mr Sokol The policy of the company has violated By buying around $ 10 million in Lubrizol shares, a maker of special chemicals, or orchestrates an acquisition of the company.
The lower key Mr. However, Abel was seen as cut from a similar canvas like Mr. Buffett. “Greg will keep the culture,” said Charles T. Munger, then the vice chairman of Berkshire and the old business partner of Mr Buffett, to the shareholders during the annual meeting of the company 2021. The comment began immediately follow -up speculation, that Buffett confirmed days later.
Mr. Abel has adopted more public tasks in recent years, including for hours on stage with Mr Buffett at the annual meetings of Berkshire to answer the questions of investors.
How is it expected that Mr. Abel Berkshire will run?
Although Mr. Buffett is known as one of the most successful stock pickers of all time, the strengths of his successor are more in running companies. That is partly a reflection of what Berkshire is today: a realm of often connected companies that together employ more than 392,000 employees.
Mr. Abel is not expected to choose the companies that go to Berkshire’s investment portfolio – the company already has two managers, Todd Combs and Ted Weschler, who have been hired by Mr Buffett to help with that. But he will supervise the species of large deals that the conglomerate may be unique to strike, given the $ 347.7 billion in cash. (Mr. Buffett has called his ‘elephant gun’.
However, that will be a major challenge. For years, Mr Buffett has not affected those kinds of acquisitions. And he has acknowledged that Berkshire is so great that it is difficult to find a takeover goal that is large enough to increase his income meaningfully.
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