gjg49

Riding the Rails: Why BNI Was Berkshire's Best Bet - And Vintage Buffett

no one in these comments asked a very important question: why did BNI's board and, most importantly, BNI's management decide to sell the whole company now rather than years from now at a presumably much greater value (i.e. price)?

buffett talks about waiting for people, probably most often private family-owned enterprises, to want to sell their businesses and then scooping them up for what will be the most advantageous circumstances for the sellers, the employees, and the customers of the firm. from the seller's perspective, this deal does not contain any components of what buffett generally seems to practice--well, maybe it will be good for the employees. as examples, recent deals for buffett resolved family issues for privately-owned mars and for the pritzker family with marmon/hyatt--how does BNI reflect any intractable issues that the sellers might face?

so, two questions:
first, if BNI holds such a promise of great long term value, why would BNI's management (not just the ceo, but the promising up-and-comers etc) want to effectively reduce their bets on what they can control, BNI itself, and instead stake their longer term futures on the vast and diffuse BRK empire??

second, why has buffett chosen this time to seemingly break his own very-well-tested modus operandi on acquisitions (yes, he bought all of flight safety and dairy queen, but these were relatively small and had somewhat special circumstances from the sellers perspective) and buy 100% of a large company??

buehler, buehler?? ...anyone, anyone ???

disclosure: i own some brk/b and bought bni last week as a risk arbitrage play.