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Sage of Omaha Warren Buffett's successor stays a secret

Agreement reached, but no clue who it is from 82-year-old Berkshire Hathaway head Buffett

Nikhil Kumar
Monday 06 May 2013 01:16 BST
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Warren Buffett has insisted that the board of Berkshire Hathaway, the mega-conglomerate he has led since the 1960s, is "solidly in agreement" over his successor, even though he gave shareholders assembled for the company's annual meeting at the weekend no clues as to who the next boss would be.

The question of succession has come up repeatedly at Berkshire's annual meetings in recent years, as shareholders wonder if 82-year-old Mr Buffett's eventual successor will be able to keep the company on as strong a footing.

The meeting again drew thousands of people to Omaha, Nebraska, to hear about the company and to interact with the legendary investor, who ahead of the meeting unveiled a more than 50 per cent leap in profits. It was also a chance for the various Berkshire companies to show off their wares to shareholders at stalls set up around the meeting venue.

Mr Buffett – who has transformed a dying textile business into a sprawling conglomerate with interests in everything from Coca-Cola to ketchup maker Heinz, and Goldman Sachs to Tesco – said the important thing was to maintaining the firm's culture once he steps down. The man dubbed the Sage of Omaha declared: "The key is preserving a culture and having a successor, a CEO that will have more brains, more energy, more passion for it than even I have... We're solidly in agreement as to who that individual should be."

Ajit Jain, who runs Berkshire's reinsurance business, and Matt Rose, who heads its Burlington Northern Santa Fe railroad business, are widely seen as the leading candidates.

In response to a question from Doug Kass, a hedge fund trader who is bearish on Berkshire's prospects, about whether the next CEO would have the same standing and influence as Mr Buffett, the current boss said it wouldn't matter, as investors would still continue to look upon Berkshire as a haven of stability.

"Berkshire is the 800 number when there is really some panic in the markets, and people really need significant capital," Mr Buffett said, referring to helpline numbers in America. "If you come to a day when the Dow [Jones Industrial Average] has fallen 1,000 points a day for a few days and the tide has gone out and you find some naked swimmers, those naked swimmers... will call Berkshire."

He also defended plans to appoint his son, Howard, currently a director, as non-executive chairman when he steps down, splitting his current role as joint chairman and chief executive into two.

"He has no illusions of running the business," the older Mr Buffett said. "He won't get paid for running the business. He'll only have to think about whether the board... needs to change the CEO."

The Sage of Omaga has shown he is in no mood to retire just yet, joining Twitter last week and amassing 375,000 followers in just four days.

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