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Next Berkshire acquisition speculation


gfp

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There IS a very small position in Diageo (DEO), which is alcohol brands, 227 thousand ADRs worth $36 million only at present, but that's not widely known because it's within the part of the Gen Re portfolio held via New England Asset Management's 13F filings.

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My father in law was a smoker for 20 years. Then my wife educated him on the health effects. One day he just quit cold turkey. So it’s not that you can’t quit because it’s addictive.

 

Both of my parents quit cold turkey when I was young and my father was smoking 3 packs per day. My wife quit cold turkey as well before we had kids.  Although she only smoked for 4 years or so before quitting.  It is possible to quit.

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There IS a very small position in Diageo (DEO), which is alcohol brands, 227 thousand ADRs worth $36 million only at present, but that's not widely known because it's within the part of the Gen Re portfolio held via New England Asset Management's 13F filings.

 

DEO’s headquarter, which is in CT, is not far from the town I live.

A couple of times I drove by, and saw helicopter was flying and parked on the rooftop. Seem they have a lot of money but possibly a wasteful culture.

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Different types of nicotine/smoking addiction.  For some it's more psychological and others it is neurochemical.

 

Those that have a really hard time are more wired - genetically - in their brain receptors to grab hold of nicotine.

 

They suffer the worst withdrawal symptoms.

 

This could be true.  But what I've found personally is that it is really really easy to just never start smoking at all.  I mean, I've been not starting smoking my entire life and it's taken me literally zero effort.

 

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Guest longinvestor

Could Pilot / Flying J buy Applegreen?

 

What are the chances that WEB starts kicking cash down to subs for acquisitions?

 

I mean, who knows their industry best?

(Including all private competitors...)

 

I believe that this is the most likely model for deploying capital over the coming decades. Many of the current heads of sub could serve this role with Jain/Abel playing Buffett. Besides the obvious micro domain depth, this will truly take care of the optics and paraphernalia associated with Buffett’s involvement in deal making. Fly under the radar deals. Todd &Ted are involved in such deal making we’re told by Buffett. I can see this being the default model. Could work well too.

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Or if not an all time high, within a hair's breadth. I think it peaked higher and closed higher on 9th October 2018 but only by about 0.5%.

 

I think there's a strong chance that today's price will look pretty unusually cheap after the 10-K comes out by any of the usual measures.

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technically I suppose Berkshire sold another company today (or Marmon did, more specifically) - Owl Wire & Cable

 

with applied underwriters we've got a certified selling spree...

 

https://www.marketwatch.com/press-release/international-wire-group-acquires-owl-wire-and-cable-2019-12-06?siteid=bigcharts&dist=bigcharts

FWIW, I think this divestiture should not be regretted.

In addition to the regulatory challenges associated with their aggressive style, there was another aspect which was questionable and for which recent work suggests that a large part of their clients would be better served by another option.

 

In my jurisdiction, the workers comp insurance market is 100% funded (premiums and payouts) by the government. However, private parties can get 'involved' in the claims handling part and a way to do this is to 'mutualize' the costs and benefits that result from this activity. I have been peripherally 'involved' in this market. California (the main market for Applied) has a large self-insured workers comp market. The advantage of the products sold (aggressively) by Applied implied 1-savings on the administrative costs due to scale, 2-lower premiums by sharing the savings coming from the built-in incentive to self-improve practices and 3-the bright and effective use of reinsurance to deal with the excess of loss component. An essential ingredient was the trust necessary to outsource this aspect of the insurance transaction. It seems that self-insured groups can do a better job at cost savings and how to share the NPV effort. The report has been sponsored by a self-insured group but results correlate with what I've seen in my neck of the woods.

 

For those interested:

https://www.dir.ca.gov/osip/AppRequirements.htm

https://www.securityfund.org/assets/docs/Bickmore%20Comparision%20Self-Insurance%20v%20Insurance%20-%20FINAL.pdf

 

Note: This is not to say that self-insured groups will take over the traditional private insurance market, it is only to say that many clients presently under the Applied umbrella could get a better (and more transparent) deal elsewhere. I doubt Mr. Buffett wastes his time on such technical details but would not be surprised if he showed an unusual lack of concern (after a discussion with Mr. Jain) when the black sheep offered to fly on his own.

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TRUMPF Group - the kind of business that would be great for Berkshire to acquire.  Also an area where Iscar is under threat from laser cutting tools for industry.

 

https://www.nytimes.com/2009/07/12/business/global/12german.html

 

Another such private company - formerly Swiss now domiciled in Liechtenstein - Hilti Group - construction tools/systems, fire prevention systems, construction services

 

https://www.hilti.group/content/dam/documents/Media-Release/2019/march/Hilti_Company-Report_2018_en.pdf

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... Another such private company - formerly Swiss now domiciled in Liechtenstein - Hilti Group - construction tools/systems, fire prevention systems, construction services

 

https://www.hilti.group/content/dam/documents/Media-Release/2019/march/Hilti_Company-Report_2018_en.pdf

 

roger,

 

Yes, Hilti is a wonderful company with wonderful products. Here, it's highly respected for the quality of its products within the construction industry.

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TRUMPF Group - the kind of business that would be great for Berkshire to acquire.  Also an area where Iscar is under threat from laser cutting tools for industry.

 

https://www.nytimes.com/2009/07/12/business/global/12german.html

 

Another such private company - formerly Swiss now domiciled in Liechtenstein - Hilti Group - construction tools/systems, fire prevention systems, construction services

 

https://www.hilti.group/content/dam/documents/Media-Release/2019/march/Hilti_Company-Report_2018_en.pdf

 

Hilti used to be a public company and traded on the Swiss exchange. Trumpf is a Family owned business with a very long term focus. They developed their own photonics Technology for their lasers (the modules are build in NJ/US) in order to control the whole value chain. I don’t think they are likely to sell out.

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TRUMPF Group - the kind of business that would be great for Berkshire to acquire.  Also an area where Iscar is under threat from laser cutting tools for industry.

 

https://www.nytimes.com/2009/07/12/business/global/12german.html

 

Another such private company - formerly Swiss now domiciled in Liechtenstein - Hilti Group - construction tools/systems, fire prevention systems, construction services

 

https://www.hilti.group/content/dam/documents/Media-Release/2019/march/Hilti_Company-Report_2018_en.pdf

 

Hilti used to be a public company and traded on the Swiss exchange. Trumpf is a Family owned business with a very long term focus. They developed their own photonics Technology for their lasers (the modules are build in NJ/US) in order to control the whole value chain. I don’t think they are likely to sell out.

 

Well, BRK could buy IPGP.  ;)

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TRUMPF Group - the kind of business that would be great for Berkshire to acquire.  Also an area where Iscar is under threat from laser cutting tools for industry.

 

https://www.nytimes.com/2009/07/12/business/global/12german.html

 

Another such private company - formerly Swiss now domiciled in Liechtenstein - Hilti Group - construction tools/systems, fire prevention systems, construction services

 

https://www.hilti.group/content/dam/documents/Media-Release/2019/march/Hilti_Company-Report_2018_en.pdf

 

Hilti used to be a public company and traded on the Swiss exchange. Trumpf is a Family owned business with a very long term focus. They developed their own photonics Technology for their lasers (the modules are build in NJ/US) in order to control the whole value chain. I don’t think they are likely to sell out.

 

Well, BRK could buy IPGP.  ;)

 

Yes, that would be a great company for Buffet to look at. I am guessing there are folks within Berkshire’s operations that understand IPGP’s  market position and moat. I have no idea if IPGP’s board would entertain a sale - the company is still founder driven to some extent.

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TRUMPF Group - the kind of business that would be great for Berkshire to acquire.  Also an area where Iscar is under threat from laser cutting tools for industry.

 

https://www.nytimes.com/2009/07/12/business/global/12german.html

 

Another such private company - formerly Swiss now domiciled in Liechtenstein - Hilti Group - construction tools/systems, fire prevention systems, construction services

 

https://www.hilti.group/content/dam/documents/Media-Release/2019/march/Hilti_Company-Report_2018_en.pdf

 

Hilti used to be a public company and traded on the Swiss exchange. Trumpf is a Family owned business with a very long term focus. They developed their own photonics Technology for their lasers (the modules are build in NJ/US) in order to control the whole value chain. I don’t think they are likely to sell out.

 

Well, BRK could buy IPGP.  ;)

 

Yes, that would be a great company for Buffet to look at. I am guessing there are folks within Berkshire’s operations that understand IPGP’s  market position and moat. I have no idea if IPGP’s board would entertain a sale - the company is still founder driven to some extent.

 

They won't sell at current valuation I'd think, while Buffett won't pay a large premium.

And maybe the company is a bit too tech for Buffett.

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Greenland.

 

Why is it that BRK has to buy all these huge companies? Why don't they acquire a mass of smaller companies?

 

Buying good small companies that can turn into multi-baggers, might actually improve BRK's pricing.

 

How much of the cash amount is actually beyond the float?

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Greenland.

 

Why is it that BRK has to buy all these huge companies? Why don't they acquire a mass of smaller companies?

 

Buying good small companies that can turn into multi-baggers, might actually improve BRK's pricing.

 

How much of the cash amount is actually beyond the float?

 

Let BRK subs do the sleuthing, negotiating & closings.

I'm sure many of them have wish lists.

 

---

 

At 1st I thought you were suggesting he buy Greenland  :o

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I've always thought a company like Fastenal would plug in well with Berkshire.

I've always thought that middleman Express Scripts was a Berkshire acquisition in waiting as well as Fastenal.  Cigna bought them last year for $52B.

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