Stocks A to Z / Stocks B / Berkshire Hathaway (BRK.A)
No. of Recommendations: 3
Somewhere along the line over the past week or so I came across something about Sokol being quite ruthless in the way he managed, before the Lubrizol fiasco. Since there are some long time holders here, I'm wondering if anyone can add color to that.
I bring it up because it seems based on a recent article that Abel is willing to jettison KHC and maybe even SIRI, on the heels of Combs leaving (maybe he sniffed out a new sheriff is in fact in town and he's tough!?) Seems like if true on the selling of KHC/SIRI that Greg is in fact a no nonsense guy, which I would love.
Since Abel was his number two early in his career, thinking maybe some of that toughness/ruthlessness has seeped into Greg.
No. of Recommendations: 4
Ruthlessness label aside, with roughly half of Berkshire’s value permanently tied to operating subsidiaries, Abel is certainly a shot in the arm. It really doesn’t matter what product or service, being THE low cost leader in your industry makes for durability. Warren was loathe to doing things to actively (hands-on) drive initiatives to support this. We have heard him eloquently speak of Tom Murphy but that was the cost-avoidance narrative. Becoming the low coast leader depends on both the plumbing (a la Geico) but also active cost management over time. One can think of the two large pillars of Berkshire, BHE and BNSF. Both need the Abel/Sokol touch as much as finding pathways to capital infusion.
On this note, let’s not forget that Jain is no slouch on low cost leadership. The world knows about the float building prowess that he has brought but less thought is given to how low the cost had been under his watch. We will never know but it is rather likely that it is Ajit who brought the cost discipline (aka headcount reductions) to Geico. There was some comments made by Ajit since occupying the seat at the head table that support this.
Everyone wants to have the growth of the likes of AAPL but NEEDS to reduce cost. No exceptions here.
Look forward to a little less management by abdication :-) The contentious topic that will surely come up to balance this will be the cultural continuity thing. We will hear more this May.
No. of Recommendations: 10
"I bring it up because it seems based on a recent article that Abel is willing to jettison KHC and maybe even SIRI, on the heels of Combs leaving (maybe he sniffed out a new sheriff is in fact in town and he's tough!?) Seems like if true on the selling of KHC/SIRI that Greg is in fact a no nonsense guy, which I would love."
It should be noted that it was KHC that put in their SEC filing that Berkshire COULD sell their stake in KHC. It wasn't Berkshire that made the filing.
Maybe Berkshire does sell the stake, maybe they don't. I just find it strange that everyone assumes Berkshire will sell the stake when they haven't said anything.
