Buffett long-term investing in a company, does not engage in intrigues, aboveboard, and often seek his stake in listed companies, and then follow the 36 meter step by step gain the initiative, and is the most welcome of the controlling shareholders of listed companies.
gain the initiative of Buffett's most classic case is investment GEICO auto insurance companies.
first step take advantage of a loophole interference
Buffett in Berkshire annual report 1995 Tanzania investment GEICO Chan is to take advantage of a loophole in interference is dangerous and even into: early “20 century 70 's, David soon after retirement, on succession management in estimating insurance costs of committing a serious error, allowing underpriced in underwriting policy of the company, and later almost led to bankruptcy. Thanks to Jack · 1976; John Byrne joined the company as CEO and drastic remedial measures, the company survived. Berkshire 1976 into GEICO shares in the second half, and later slightly overweight. To the end of 1980, total investment of us $ 45.7 million, owns one-third shares of GEICO. &Amp;rdquo;
second adhere to long-term holding
since then, Buffett 15 not overweight, but insisted on a long-term holding, a unit not for sale, gradually gain the initiative, become absolute controlling shareholder holding 50%: “ although we have not carried out within the next 15 years to increase its stake, but due to the weapons buy-back shares in this company, increasing our stake to about half. &Amp;rdquo;
1995-year BA feite gain the initiative, fully controlling shareholders: “ that by the year 1995, we agreed to under US $ 2.3 billion to buy the other half is not part of the shares. It is a very high price. However only such a high price to make us totally have a high growth company. &Amp;rdquo;
after the privatization of GEICO has since become one of the core of the Kingdom of Buffett investment insurance company, its huge premiums for Buffett to provide large amounts of profits and investment funds.
step into listed companies valued customers
Buffett adhere as buying companies to buy shares as a long-term investment to do long-term shareholders: “ we study business prospects, is responsible for operation management, and the price we must pay. In fact, we are willing to stake indefinitely, as long as the intrinsic value of the company is expected to increase at a satisfactory rate. &Amp;rdquo;
long-term investments like Buffett who is the real shareholders in listed companies. This real long-term investors for him in the minds of all listed companies ' management has won the VIP status. So once listed companies want a directed issue introduced a long-term strategic investor, Warren Buffett is preferred.
20 century 70 's, GEICO insurance company faced bankruptcy due to business failures, urgently needed financial support in Buffett's long-term investment in the Washington Post company boss Catherine · Graham introduced, new Chief Executive Jack so he found Buffett a stake. (Shanghai Securities News)
