jbwent63

In Canada, this is correct. We do not have the ability to file consolidated tax returns. In the US you can. This is why when Warren makes the statement that BH's tax return is 1000's of pages, its because there are many subsidiaries that file together under the parent umbrella. Not sure about other foreign jurisdictions (other than Poland where I have some familiarity, and consolidation of tax filings for corporations is not allowed.) So in the US if you have profits in one entity (NICO for example) they can be offset by losses or tax credits (BHE for example). Gfp's comment above about deferred tax assets is correct. They are not prepaid taxes. There is a separate tax liability/asset account for current tax accounts. Deferred or Future tax assets generally arise from timing differences, as was noted, typcially unused NOL's. Deferred tax liabilities come from timing differences such as accounting depreciation being less than allowed tax depreciation, booked but unrealized capital gains etc.

Those of us who thought it would be a swap were mistaken. I didnt see the whole interview with the CEO on CNBC but she made it clear that paying off the debt was the goal, restarting a share repurchase program will happen, and they will start to build a cash reserve to take out the BRK preferreds in 2029. The big win for BRK should be appreciation in the OXY common shares, hopefully beyond the warrant strike price before the preferreds are paid out (I think the warrants expire when that happens). Hopefully OxyChem will fit in well with Lubrizol (if that is the integration plan) and it throws off a lot of cash as well. Not an elephant, but not a bad sized acquisition for Greg and Warren.

My assumption was, given the high non-deductible dividend rate they would quickly look to refinance with cheaper paper as soon as they could. I understand it is the first time they can, but I believe they would be remiss in not doing so (unless the financial markets didnt allow them to refinance on favorable terms).

All correct. In addition the preferreds are like debt. They have a high, non-deductible coupon, fixed repayment/redemption date (2029), they are just in a different bucket on the balance sheet according to GAAP. Not having to pay cash to redeem solves a problem for OXY allowing them to use those resources to pay back more of the Anandarko debt faster....another win for both parties.

I should have elaborated. By agreeing to exchange the preferreds for Oxychem, I am assuming that the valuation of the preferreds would be maximized (and the potential for appreciation in the commons and the warrants) and the valuation of the chemicals business minimized such that both parties are feeling a win after future dividends and current taxes are taken into account. BRK can replace some of the current preferred dividend with a dividend from the newly acquired entity. Let's see what happens. My bet is it's a non-cash transaction.

Does anyone think this could be a swap, the outstanding preferreds held by BH for the chemicals business? Might be very tax efficient.... Like the Gillette/P&G deal or the GHC deal?

Thank you sir. Very informative. Jeff

With Warren's stake in play when Methusulah does catch up to him (I too hope it isn't for years), do we think the market will be the buyer, or will Berkshire have a chance to buy in these shares (i.e. a ROFR)?

The items shown as Comprehensive income do not flow through the income statement, it is a separate statement altogether. The $877 loss vs $446 gain q over q is what Chris is referring to when he is trying to compare operating earnings only. The other exchange gains and losses in operating earnings are immaterial to BRK. The headlines were "BRK Operating Earnings drop 4%". Chris' point is without the f/x gain loss on the debt the operating earnings are actually up. Note also that the loss on the Yen bonds would be offset in the investment gains on the Yen denominated common shares owned.

The sellers are two of the pension master trusts, BNSF (3,800,000) and the rest is held in the BH Consolidated Master Trust. There are other pension master trust investments that are not included, PCC and Scott Fetzer. Interesting the reason given is to get below the 10% reporting threshold. One year standstill agreement in place for the remaining shares held by BH and affiliates. https://www.sec.gov/Archives/edgar/data/1014473/000114036125027577/ny20052578x1_s3asr.htm

Correct. Acquisitionco would carry the investment at its cost, which would only be adjusted for additional purchases or sales/redemptions. On consolidation of the subsidiary the earnings since acquisition flow through consolidated retained earnings, but do not impact on the cost. Dividends also flow through the income statement and do not impact on the carrying cost of the investment. The capital on the target at the date of the acquisition would be eliminated on consolidation against the purchase price with the excess being recorded as an intangible asset (typically goodwill, could be other intangibles). If the purchase price was EUR 21 million and there have been no other capital transactions, then the gain would be recorded against this cost. If there was a sale and leaseback this would have presumably been at the opco level and would not be recorded at the acquistitionco level. The only other reason to adjust the cost basis would be impairment, but I dont think there was any relating to this investment.

I think it's close, but not yet. 16 months ago was the last (reported) purchase at 625K. Today we are around 705K, about 12% higher. Not sure if WEB or GA would agree that it has gone up 12% in that time period, but it has most likely gone up some. 10-Q is most likely next chance we get to see shares outstanding and it looks like August 2 will be the release date. Does anyone on here live in Omaha? Can you see the cash piling up outside 3555 Farnam?

DHL has mine. Sent me the notification to pay sales tax and fees to clear customs. I'm happy to pay it. Better than dragging it home (to Ontario) from Omaha. Can't wait to get it. Thanks, Warren.

Thanks, I was not aware of that rule....always learning.

Does anyone think that WEB might have been dabbling in the B shares at the end of the session today? Looks like almost 1.5 million B shares traded in the last 5 minutes (per CNBC chart). Anyone else thinking of a nibble down almost 10% from the high?

Me either, a surprise. I'm wondering if there was a fallout with the Phelan family (who I believe owned the other 16%) which precipitated such minimal disclosure. Happy to have it all under the roof now.

I'd like to think as well that Abel is already influencing the subs underneath him in order to maximize cashflow (and earnings) back to Head Office.

Note that the sales are "System" sales. I'm not sure how many of the units are corporate vs franchised, so Recipe's revenue would not be the full $3.6 B (that is my understanding) in that Recipe would only record franchise fees, royalties and advertising fees on the franchised restaurants.

Berkshire Hathaway CDR to trade on TSX 2025-02-03 19:32 ET - New Listing The Toronto Stock Exchange reports that it has approved the original listing of Canadian depositary receipts (CDRs) issued by Canadian Imperial Bank of Commerce. According to the TSX, Berkshire Hathaway CDR (CAD Hedged) will be listed and posted for trading on the TSX at the open on Feb. 5, 2025. There will be 9.8 million CDRs issued and outstanding, and 50,000 CDRs reserved for issuance. The CDRs will trade under the symbol BRK, in Canadian dollars and with Cusip No. 08465W 10 0. The designated market-maker is CIBC World Markets Inc., and the transfer agent and registrar is TSX Trust Company at its principal office in Toronto. The TSX reports that the CDRs are securities that represent a beneficial ownership interest in a pool of shares of common stock of Berkshire Hathaway Inc. The underlying shares are listed on the New York Stock Exchange under symbol BRK.B. The CDRs are designed to provide Canadian investors with a fractional ownership interest in the underlying shares in Canadian dollars with a currency hedge. The CDRs have been listed on Cboe Canada since Dec. 1, 2021, under the symbol BRK. Each CDR is equivalent to owning a fractional interest in the underlying shares. This is represented by the CDR ratio. The CDR ratio is adjusted on a daily basis to provide a notional currency hedge. As the ratio increases or decreases, the number of underlying shares represented by one CDR increases or decreases. So, if the Canadian dollar strengthens, the CDR will represent a larger number of underlying shares. Conversely, if the Canadian dollar weakens, the CDR will represent a smaller number of underlying shares. For example, if on a given day a CDR holder owns 100 CDRs and the CDR ratio is 0.10 on that day, then the CDR holder's interest in the pool provides entitlements that are based on the entitlements that would arise from beneficially owning 10 of the applicable underlying shares with a notional hedge into Canadian dollars of the market value in the applicable foreign currency in which such underlying shares are listed for trading on their principal securities exchange or other trading market. The CDR ratio for each series of CDRs will be calculated daily and will be available at the CDR website under the CDR directory tab. The TSX notes that CDR investors will be entitled to vote the underlying shares through CIBC's on-line voting portal. CIBC Mellon Trust Company, as the depositary, will then vote the underlying shares in accordance with the instructions provided on a commercially reasonable best-efforts basis. The number of underlying shares that each CDR holder can vote will depend on how many CDRs they hold and how many underlying shares each CDR reflects. Dividends paid on the underlying shares will be passed through to CDR investors in Canadian dollars when received by the depositary. The record date for determining which CDR holders are entitled to receive any dividends in respect of CDRs will be the record date set by the relevant underlying issuer. The depositary will notify CDR holders of any record dates via the CDR website under the corporate actions tab. The deposit agreement sets out the terms of CDR holders' undivided co-ownership interests in the pool of underlying shares held for the relevant series of CDRs. Each CDR represents an equal undivided direct beneficial interest in the underlying share pool. CDR holders do not have any ownership interest in any particular underlying shares or number or fraction thereof, and CDR holders will not be considered to be shareholders of the underlying issuer for the purposes of Canadian or U.S. securities laws. For more information, see CIBC's short form base shelf prospectus dated Aug. 15, 2023, as amended by amendment No. 1, dated May 24, 2024, and amendment No. 2, dated Jan. 23, 2025, and prospectus supplement No. 1 dated Aug. 15, 2023, which are available on SEDAR+. Reference should be made to the deposit agreement dated as of July 16, 2021 (as amended), and amended and restated with effect as of May 28, 2024, among CIBC and CIBC Mellon, as the custodian, for the complete attributes of the CDRs.

This small issue was probably partially used to fund the repayment of bonds maturing imminently. 41.6 million Yen issued in 2020. Another 55.0 million Yen issued in 2022 coming due in December, so he may have prefunded this as well.

My thoughts exactly. Ruby was long-winded as well. Ask the question, don't tell a story. Make time for others to ask their questions.

Last night i listened to Travelling Wilburys Volume 1 all the way through. What a great record. Dylan's lyrics just shine, especially on "Tweeter and the Monkey Man". Orbison's vocals are top notch. I wonder what would have been had Roy not passed away after Volume 1 and before Volume 3.

Announcement of the RTO of Boat Rocker Media Inc. by Blue Ant Media (both owned by FFH) has not sparked any discussion. Is it too small to worry about? Seems like an elegant way to exit BRMI (albeit there are strings attached). Any thoughts? https://ca.finance.yahoo.com/news/boat-rocker-media-signs-definitive-111800928.html It is interesting that BRMI stock is virtually unchanged at $0.80 where this deal trumpets a value of $1.80. Does the lack of movement indicate the market thinks it will not go ahead, or that the $1.80 is inflated, or both?

I read somewhere that the Indian government is privatizing some airports. Any chance FFHI et al might be involved in a purchase of more airports given the success of BIAL?

I answered my own question. The filings indicate the ownership change is either exactly 1.00% or just a bit more than 1.00% higher, meaning that the shares acquired since year-end pushed their ownership beyond an extra full percent, causing the need to make the filings. I also do not read Japanese, but it appears the filings may be as of March 10, not today to be precise.