Berkshire on Hunt for More Heinz-like Deals, Buffett Says

Monday, 04 Mar 2013 07:57 AM

 

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Berkshire Hathaway Inc. is on the hunt for more deals similar to its planned purchase of H.J. Heinz Co., Warren Buffett, the conglomerate's chief executive, said on Monday.

"If we get a chance to buy another Heinz, we will do that," Buffett said on CNBC.

Berkshire likes the ketchup maker's business, the deal's $23 billion price, and its partner in the transaction, private equity firm 3G Capital, Buffett said in an extended interview.

Declassified: ‘Financial War’ Could Wipe Out 50% of Your Wealth’

"We hope to own Heinz 100 years from now," Buffett said. "If you own great brands and you take care of them, they're terrific assets."

Buffett said he is not currently eyeing another consumer- products company, but is looking at a possible deal in a sector he would not disclose. After a recent binge of buying newspapers, he said he is not interested in buying the Chicago Tribune or the Los Angeles Times from the Tribune Co.

After the Heinz purchase was announced, the U.S. Securities and Exchange Commission filed a lawsuit against unnamed traders the agency said used a Goldman Sachs account in Switzerland to trade on purported inside knowledge of the transaction. Buffett said Berkshire likes to move quickly on deals to avoid information leaks, and said he could "guarantee" the person who made questionable options trades ahead of the deal was acting on inside information.

"They will nail that guy, and they should," he said.

In his annual letter to shareholders on Friday, Buffett said Berkshire may end a long streak of outperforming the S&P 500 this year. For the first time, the growth in Berkshire's book value per share may underperform the growth in the S&P 500 when measured over a five-year period, he added.

In the CNBC interview, Buffett said he will be giving Berkshire money managers Todd Combs and Ted Weschler more money to invest after a successful year. As of March 31, they will both manage about $6 billion each, up from $5 billion apiece, Buffett said.

"Todd and Ted are young and will be around to manage Berkshire's massive portfolio long after (Berkshire Vice Chairman) Charlie (Munger) and I have left the scene," Buffett wrote in Friday's letter. "You can rest easy when they take over."

Declassified: ‘Financial War’ Could Wipe Out 50% of Your Wealth’

© 2014 Thomson/Reuters. All rights reserved.

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