Friday 24 November 2017

Buffett anoints successor to manage his billions

Warren Buffett turned 80 in August, but insists he has no intention of retiring. Photo: Getty Images
Warren Buffett turned 80 in August, but insists he has no intention of retiring. Photo: Getty Images

Stephen Foley in New York

Warren Buffett, who heads the beloved American conglomerate Berkshire Hathaway, has named an obscure 39-year-old hedge fund manager to oversee much of the company's money, making him the favourite to succeed the billionaire investment guru.

For the past five years, Todd Combs has run a Connecticut hedge fund called Castle Point Capital, which withstood the financial crisis, despite investing almost solely in financial companies.

"For three years [Berkshire's vice-chairman] Charlie Munger and I have been looking for someone of Todd's calibre to handle a significant portion of Berkshire's investment portfolio," Mr Buffett said in a statement to his shareholders. "We are delighted that Todd will be joining us."

The billionaire also told Fortune magazine that Mr Combs is not in the least bit interested in publicity.

Mr Buffett turned 80 in August, but insists he has no intention of retiring from the company he bought in 1965 and turned into a $200bn colossus with businesses ranging from global insurance to local furniture stores.

However, speculation about Mr Buffett's successor remains rampant and he has said he expects his responsibilities will be split at least three ways, with his son, Howard, as chairman, with a new chief executive to take over running the existing businesses.

Mr Buffett has been trying out a handful of managers for the other post of Head of Investments, who would be the main "ideas man" at the company – and an heir to Mr Buffett's informal role dispensing folksy investment wisdom to shareholders and others.

Earlier this year, Mr Munger said it was a "foregone conclusion" that Li Lu, 44, a protester during the Tiananmen Square massacre in China in 1989 – now a US hedge fund manager – would also have a role managing Berkshire's investments, by Mr Combs' appointment yesterday is the first formal indication of what is being planned for a post-Buffett future.

After a stint working for a major competitor to Berkshire, Mr Combs set up Castle Point in 2007, managing more than $400m (€287m) for investors. He impressed the cautious Buffett by steering clear of toxic investments such as Lehman Brothers and AIG and buying back into the markets at their lows.

It has been announced that Mr Combs' hedge fund will be wound down.

Independent News Service

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