Next Berkshire acquisition speculation

[Whensthepaintdry?]

wouldn’t that  be similar to Clayton?

Edited March 20, 2023 by Whensthepaintdry?

[redskin]

6 hours ago, yesman182 said:

I agree.

 

I have a dumb questions to play devils advocate. I understand Ally is a bank, but is it a bank because it keeps deposits or because it issues loans. Could Berkshire buy Ally and then sell the online bank and CC business and brokerage business, while retaining the  insurance and loan book and the ability to generate more loans using Berkshires Capital? What would another bank pay for $150 Billion in 90% insured deposits at a time like this? 

I know nothing about Ally, but you mention $150 billion in deposits.  I assume those deposits are funding their loans.  Berkshire would need to fund the loans if they sell the deposits.  If you assume a bank can earn 1% ROA, they could make $1.5 billion on those deposits.  Maybe a 10 multiple ($15B)?  I would assume a lower multiple as you don't know if you will retain all of the deposits.

[ValueMaven]

Ingersoll Rand would be a great addition to the MSR family !!  Little overlap with PCC, Marmon, and ISCAR.  Great management - and a lot of bolt on M&A they can do.  

[yesman182]

Would Berkshire ever buy Tupperware? It seems like that is a brand that has been strugeeling for some time. My mother-in-law has a ton of there products from decades ago. They seem to really last, but the idea of selling things at Tupperware parties seems too old fashion and the Tupperware website has really high shipping cost. I don't know what pampered chef is up to, ( I have never purchased anything from them). But it seems like with such a similar model they could be combined.  It would be a meaningless tuck-in acquisition. Since the stock price fell in half today I thought I would bring it up.

[rkbabang]

3 minutes ago, yesman182 said:

Would Berkshire ever buy Tupperware? It seems like that is a brand that has been strugeeling for some time. My mother-in-law has a ton of there products from decades ago. They seem to really last, but the idea of selling things at Tupperware parties seems too old fashion and the Tupperware website has really high shipping cost. I don't know what pampered chef is up to, ( I have never purchased anything from them). But it seems like with such a similar model they could be combined.  It would be a meaningless tuck-in acquisition. Since the stock price fell in half today I thought I would bring it up.

 

 

My wife just bought a set of Tupperware at Target.  It looks and feels just like the stuff we had when I was a kid in the 70s/80s.  Apparently you don't have to go to a party to buy it anymore.

 

https://www.target.com/p/tupperware-heritage-get-it-all-set-30pc-set/-/A-86507159?preselect=85452290#lnk=sametab

Edited April 10, 2023 by rkbabang

[Spekulatius]

I am old enough to remember Tupperware parties too, but I think this brand is in a slow terminal death spiral. Also, it’s just my guess that Pampered Chef (which was supposedly bought for ~$900M in 2002) was a bust too. Revenue estimates differ and seem to be in the $200-$350M ballpark which is not a good show for something bought 20 years ago for $900M.

 

[Gamecock-YT]

https://archive.md/G8MZu

 

Quote

TOKYO -- Warren Buffett told Nikkei in an interview on Tuesday that he intends to add to his investments in Japanese stocks, saying he is "very proud" of his holdings in companies including the nation's top five trading groups.

Buffett's Berkshire Hathaway disclosed in August 2020 that it acquired slightly more than 5% each in Japan's top five trading houses, which are known in Japan as sogo shosha, themselves investment companies. 

"We're very proud of that," Buffett told Nikkei in Tokyo, saying he would meet with the companies this week "to really just have a discussion around their businesses and emphasize our support."

 

 

https://flightaware.com/live/flight/N177QS/history/20230409/2140Z/KOMA/RJTT

 

 

If I was a 92 year old I wouldn't be flying 12 hours across the pacific and dealing with the jet-lag unless I had a good reason. Granted having 1 of 3 Netjet Global 7500s doesn't hurt.

Edited April 11, 2023 by Gamecock-YT

[gfp]

Nice plane - certainly makes that trip easier!  Warren and Greg Abel will be on CNBC tomorrow morning, being interviewed by Becky Quick off and on for the entire show.  

 

Nice to see Greg putting his mark on things by installing his own two executives to run Pilot and now meeting with each of the Japanese trading houses alongside Warren.  There are plenty of opportunities for these five Japanese companies and Berkshire Hathaway to do business together.  Doesn't hurt to show up in-country when you are trying to put together a yen bond sale either!

 

I do think these companies were the reason Warren omitted the list of the 15 largest equity investments in the annual letter.  Hopefully the list will return next year.

[sleepydragon]

2 hours ago, gfp said:

Nice plane - certainly makes that trip easier!  Warren and Greg Abel will be on CNBC tomorrow morning, being interviewed by Becky Quick off and on for the entire show.  

 

Nice to see Greg putting his mark on things by installing his own two executives to run Pilot and now meeting with each of the Japanese trading houses alongside Warren.  There are plenty of opportunities for these five Japanese companies and Berkshire Hathaway to do business together.  Doesn't hurt to show up in-country when you are trying to put together a yen bond sale either!

 

I do think these companies were the reason Warren omitted the list of the 15 largest equity investments in the annual letter.  Hopefully the list will return next year.

My own prediction: they will bring Mr. Buffett to the best restaurant in Japan and they will serve sashimi made of $1 million dollar fish, and Mr. Buffett will want a cheese burger.

[oscarazocar]

12 minutes ago, sleepydragon said:

My own prediction: they will bring Mr. Buffett to the best restaurant in Japan and they will serve sashimi made of $1 million dollar fish, and Mr. Buffett will want a cheese burger.

[fareastwarriors]

5 hours ago, sleepydragon said:

My own prediction: they will bring Mr. Buffett to the best restaurant in Japan and they will serve sashimi made of $1 million dollar fish, and Mr. Buffett will want a cheese burger.

 

Take him to Mos Burger

 

or any American fast food franchises in Japan. They're so much better than the ones we have here in the good ol' USA. 

[Gamecock-YT]

Two of the companies own FamilyMart and Lawson’s. Could see uncle warren enjoying some famichiki.

[yesman182]

Would BRK buy the Trans Mountain pipeline from Canada? Seem like a fat pitch for Greg at the right price, whatever that might be. 

 

https://www.ft.com/content/63b034ad-78f3-428e-a754-7f5cf509b1b0

[Saluki]

Since he likes good companies with a bad balance sheet, I wonder why they don't make an offer on Nextera Energy Partners.  SunEdison used to put together solar projects and drop them into a controlled and publicly traded subsidiary called Terraform which would pay investors a fixed return on the assets. 

 

NextEra does the same thing with Nextera Energy Partners.  Higher interest rates and higher costs from inflation make it harder to put those deals together.  But Berkshire Energy is big in the renewables sector, and they have a fortress balance sheet. They can use that to buy these assets which already deployed or fund new ones.  

 

I know he's mentioned before that he's not interested in Mars, the candy company.  But Mars also owns pet food companies and now a chain of Veterinarian hospitals (Banfield) and pet insurance. Even if you don't like the low end candy business, the pet side of the company looks interesting.  Mars is a private company and the brothers who are running it now are competent, but they won't live forever and word is that competence looks like it's skipped a generation in the people who are supposed to inherit the business. 

[ValueMaven]

I've suggested Ingersoll Rand a few times in the past

[Eldad]

1 hour ago, Saluki said:

Since he likes good companies with a bad balance sheet, I wonder why they don't make an offer on Nextera Energy Partners.  SunEdison used to put together solar projects and drop them into a controlled and publicly traded subsidiary called Terraform which would pay investors a fixed return on the assets. 

 

NextEra does the same thing with Nextera Energy Partners.  Higher interest rates and higher costs from inflation make it harder to put those deals together.  But Berkshire Energy is big in the renewables sector, and they have a fortress balance sheet. They can use that to buy these assets which already deployed or fund new ones.  

 

I know he's mentioned before that he's not interested in Mars, the candy company.  But Mars also owns pet food companies and now a chain of Veterinarian hospitals (Banfield) and pet insurance. Even if you don't like the low end candy business, the pet side of the company looks interesting.  Mars is a private company and the brothers who are running it now are competent, but they won't live forever and word is that competence looks like it's skipped a generation in the people who are supposed to inherit the business. 

6 members in Forbes top 100 and Private. I’d keep it if I were them. 

[longterminvestor]

22 hours ago, Saluki said:

Since he likes good companies with a bad balance sheet, I wonder why they don't make an offer on Nextera Energy Partners.  SunEdison used to put together solar projects and drop them into a controlled and publicly traded subsidiary called Terraform which would pay investors a fixed return on the assets. 

 

NextEra does the same thing with Nextera Energy Partners.  Higher interest rates and higher costs from inflation make it harder to put those deals together.  But Berkshire Energy is big in the renewables sector, and they have a fortress balance sheet. They can use that to buy these assets which already deployed or fund new ones.  

 

I know he's mentioned before that he's not interested in Mars, the candy company.  But Mars also owns pet food companies and now a chain of Veterinarian hospitals (Banfield) and pet insurance. Even if you don't like the low end candy business, the pet side of the company looks interesting.  Mars is a private company and the brothers who are running it now are competent, but they won't live forever and word is that competence looks like it's skipped a generation in the people who are supposed to inherit the business. 

there is some speculation that Mr. Buffett could have bought Mars in 2007-2010 time period however told Ms. Jacqueline Mars that she should not sell a great business, just keep running it.  For context, either before or after that advice, Berkshire gave Ms. Mars a loan to buy Wriggly.  I am unable to find a source for Mr. Buffett saying Mars should not sell to Berkshire, so it is speculation.  I shouldn't be spreading speculation but I am in hopes someone else knows more about the relationship between Mars and Berkshire specifically Mr. Buffett's advice to the Mars family regarding their business.  

[KPO]

SIRI seems like a candidate since Berkshire will already own a third of it post Liberty/SIRI consolidation and it’s at a somewhat undemanding valuation at this stage.  I still don’t love the business (or balance sheet), but that’s probably because I’ve only used the service as a trial and hold a perception that there are many substitute services. 

[Munger_Disciple]

1 hour ago, KPO said:

SIRI seems like a candidate since Berkshire will already own a third of it post Liberty/SIRI consolidation and it’s at a somewhat undemanding valuation at this stage.  I still don’t love the business (or balance sheet), but that’s probably because I’ve only used the service as a trial and hold a perception that there are many substitute services. 

That sounds like a shitty acquisition target. I hope to God that Berkshire doesn't buy this  melting ice cube.

[KPO]

1 hour ago, Munger_Disciple said:

That sounds like a shitty acquisition target. I hope to God that Berkshire doesn't buy this  melting ice cube.

I agree, but it was shitty when they built up a position of over 30% of shares outstanding, it’s just much cheaper now.  As I said in my post, I don’t like the business, but evidently Ted does. 

[Munger_Disciple]

3 minutes ago, KPO said:

I agree, but it was shitty when they built up a position of over 30% of shares outstanding, it’s just much cheaper now.  As I said in my post, I don’t like the business, but evidently Ted does. 

 

That doesn't matter. Warren and Greg make the call on acquisitions. 

[Spekulatius]

On 5/30/2024 at 2:34 PM, Munger_Disciple said:

 

That doesn't matter. Warren and Greg make the call on acquisitions. 

I think it goes into WEB too hard pile.

[KPO]

23 minutes ago, Spekulatius said:

I think it goes into WEB too hard pile.

Let’s hope so! 

[rogermunibond]

Didn't WEB do something similar with Gen Re.  First buying shares then the whole thing.

[mjm]

know he did on GEICO