"Oracle of Omaha" Buffett Steps Down from Active Management
Vice Chairman Greg Abel Appointed as New CEO
Buffett to Remain as Chairman and Advisor to Management
Warren Buffett, the renowned American value investor known as the "Oracle of Omaha," has stepped down from his position as Chief Executive Officer (CEO) of Berkshire Hathaway, concluding his 60-year tenure at the helm of the company.
Warren Buffett, Chairman of Berkshire Hathaway, is opening a bottle of Cherry Cola while playing bridge outside Borsheims Jewelry, owned by Berkshire, in Omaha, Nebraska, USA, in 2018. Photo by AP Yonhap News
According to foreign media reports on January 1, Greg Abel, 63, whom Buffett designated as his successor, officially took office as the new CEO of Berkshire Hathaway with the start of the new year. While Buffett has relinquished the CEO role, he will remain as Chairman and continue to commute daily to the company's headquarters in Omaha, Nebraska, where he will provide advice on overall management.
The new CEO, Abel, joined the group in 2000 during Berkshire's acquisition of MidAmerican Energy. Since then, he has been recognized for his management abilities, particularly in the energy sector, and since 2018, he has served as Vice Chairman overseeing the core businesses excluding insurance.
At the annual shareholders' meeting in May last year, Buffett surprised the market by announcing his plan to step down as CEO at the end of 2025. On his final working day, December 31 (local time), Berkshire Hathaway's Class A shares closed at $754,800, down 0.1% from the previous day, while Class B shares fell 0.2% to $502.65.
It is estimated that investors who have held Berkshire shares since Buffett took control in 1965 have earned cumulative returns of approximately 6,100,000% over about 60 years. This performance far exceeds the S&P 500 index's return, including dividends, over the same period.
Berkshire has grown into a massive holding company with subsidiaries in various industries, including the insurance company GEICO, the railroad operator BNSF, and the consumer brand Dairy Queen. As of the end of September last year, the company held $381.7 billion in cash and cash equivalents, and $283.2 billion in equity securities. Major investment holdings include Apple, American Express, Bank of America, Coca-Cola, and Chevron.
However, it has not yet been revealed who will be responsible for overseeing the group's overall investment strategy after Buffett. The market is also closely watching whether there will be any changes to the portfolio management system in the future.
According to the Bloomberg Billionaires Index, Buffett's personal fortune currently stands at around $150 billion, ranking him among the world's top 10 wealthiest individuals. He has expressed his intention to donate a substantial portion of his accumulated wealth and is recognized for his significant philanthropic contributions.
With Buffett stepping down as CEO, his annual shareholder letter, long considered essential reading for investors each year, will no longer be published.
© The Asia Business Daily(www.asiae.co.kr). All rights reserved.
