Warren Buffett: Tracy Britt isn't Berkshire CEO successor - Omaha.com
Published Monday, June 24, 2013 at 1:00 am / Updated at 11:33 am
Warren Watch
Warren Buffett: Tracy Britt isn't Berkshire CEO successor

Sometimes reporters get a bit ahead of the facts.

Last week's item following up on a Wall Street Journal profile of Warren Buffett's financial assistant Tracy Britt stretched toward the question of whether she might, someday, succeed him as CEO of Berkshire Hathaway Inc. Seemed like the logical question to explore, as others have done in print and online.

But not exactly, Buffett said in an email (relayed from his computer-less office through his assistant, Debbie Bosanek).

“I hope these facts put some unwarranted speculation to rest,” Buffett said.

Namely:

>> Britt's office is a ways down the hall, not next to his, as the Journal article said. The office sequence, in footage away from Buffett's corner office, is Bosanek, Todd Combs, Britt and Ted Weschler. Combs and Weschler manage some of Berkshire's investments.

Buffett calls Todd, Tracy and Ted “the T's.” He said Bosanek's office will remain next to his “as long as the two of us are around.”

>> Britt met Buffett in 2006 and worked on a project for him in the summer of 2009 after graduating from Harvard Business School. She brought a basket of corn and tomatoes to Berkshire’s Omaha headquarters when she reported that summer. She then went to work for Fidelity Investments for four months before Buffett hired her in December 2009. “I decided I needed her and hired her away from Fidelity,” he said. “It was a great decision, as were the decisions to hire Todd and Ted.”

>> Buffett has used the male pronoun in referring to his chosen successor, and reporters have asked whether that means that the current candidates for the job are all males. “I've always said yes,” Buffett said.

As for that bit about having his successor's name in an envelope — well, that's always been a joke.

“I've also publicly stated many times that succession is the main topic of every meeting of directors and has been so for more than a decade,” Buffett said in the email. “They are 100 percent in agreement as to who my successor should be, and it remains a male.”

Buffett also has said that the board's choice for his successor can change over the years.

In public comments just before the May meeting of Berkshire shareholders, Buffett talked about the importance of women becoming leaders in business. Maybe in 10 or 15 years, he said, his favored successor will be a woman, adding, “I hope it is.”

On Heinz board

Meanwhile, Buffett and Britt have a new job: Serving on the board of H.J. Heinz Co., the food company acquired on June 7 by Berkshire and 3G Capital.

Also joining the Heinz board, according to a regulatory filing, was Gregory Abel, CEO of Berkshire's MidAmerican Energy Holdings Co. of Des Moines. Abel also has been the subject of speculation about being a candidate for Berkshire's top job.

Six new Heinz directors and new top executives were part of the purchase plan by 3G, which Buffett has said is in charge of operating the newly acquired business.

Among the directors they replace is Lynn Swann, a member of the Pro Football Hall of Fame and star receiver for the Pittsburgh Steelers. Heinz's headquarters is in Pittsburgh.

Merger pays off

Rick Edmonds wrote for the Poynter Institute that the recently announced merger between Media General and New Young Broadcasting means a payday for Berkshire.

Berkshire acquired Media General's newspapers, except the Tampa (Fla.) Tribune, in May 2012 and loaned the company $445 million to refinance its debt, with a 10.5 percent interest rate. Berkshire also got the right to acquire 19.9 percent of Media General.

The merger with New Young will let Media General refinance its debt, paying Berkshire a $44 million premium in the process.

Media General's stock price rose more than 30 percent when the merger was announced and is now double the price of May 2012, meaning Berkshire's stock purchase rights gained $25 million.

“So, consider the sweet deal a quick demonstration — on a modest scale for giant Berkshire Hathaway — of how Buffett got to be one of the five richest men in the world,” Edmonds wrote.

Lessons for Bill Gates

Bill Gates, the co-founder of Microsoft, close friend of Buffett's and a director of Berkshire Hathaway, said he likes coming to the Berkshire shareholder meetings in Omaha. He recently posted some things he has learned over the years from Buffett:

1. Buffett has a “powerful” framework for thinking about business, not just investing skill.

Before they met, Gates figured Buffett used market-related factors like volume and price trends to make decisions. “Why would I want to meet this guy who picks stocks?” Gates thought.

But when they met, Buffett asked “big questions” about the fundamentals of Microsoft: Why can't IBM do what Microsoft does? Why has Microsoft been so profitable?

“That's when I realized he thought about business in a much more profound way than I'd given him credit for.”

2. Business leaders should speak out. Buffett's annual letter to shareholders and willingness to talk publicly about issues inspired Gates to write an annual letter for the Bill & Melinda Gates Foundation. “I still have a ways to go before mine is as good as Warren's, but it's been helpful to sit down once a year and explain the results we're seeing, both good and bad.”

3. You can't buy time. Buffett has “a keen sense” of the value of his time, keeping his calendar clear of useless meetings. But he can be generous with his time for people he trusts, close advisers and university students.

“He's one of a kind,” Gates said.

The Omaha World-Herald Co. is owned by Berkshire Hathaway Inc.

Correction: A previous version of this column incorrectly stated when Warren Buffett hired Tracy Britt.

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