By George Williams
The CEO of Berkshire Hathaway (BRK.B), millionaire investor Warren Buffett, is willing to acquire some more firms in the $5 billion to $20 billion range, showed the latest Berkshire Hathaway annual letter. "Charlie [Munger] and I hope that the per-share earnings of our non-insurance businesses continue to increase at a decent rate. But the job gets tougher as the numbers get larger. We will need both good performance from our current businesses and more major acquisitions. We're prepared. Our elephant gun has been reloaded, and my trigger finger is itchy," Buffett wrote in this year's annual letter.
Speculation was rife that Berkshire would soon implement a dividend as a way to manage its large cash but Buffett did not hint that whether he was willing to launch that plan. His annual letter, which was released Saturday, talked more about the acquisition discussion only.
"Charlie [Munger] and I frequently get approached about acquisitions that don't come close to meeting our tests: We've found that if you advertise an interest in buying collies, a lot of people will call hoping to sell you their cocker spaniels. A line from a country song expresses our feeling about new ventures, turnarounds, or auction-like sales: 'When the phone don't ring, you'll know it's me.'," added the intelligent investor.
Buffet also wrote about the advantage of Berkshire Hathaway over other companies in terms of being able to reinvest capital across many industries. "Most companies limit themselves to reinvesting funds within the industry in which they have been operating. That often restricts them, however, to a 'universe' for capital allocation that is both tiny and quite inferior to what is available in the wider world,” he wrote.
