Buffett has pledged to hold. Guessing what’s next is exceedingly difficult, although we can narrow down the possibilities. Mr. Buffett does not go looking for something that Berkshire “needs.” Add-on deals are done regularly, but typically by the operating subsidiaries themselves. Last year, for example, Marmon made several low-profile acquisitions.
Mr. Buffett has also declared that there is no tax or accounting need for more underwriting operations, although it remains a business he clearly likes. He also prefers U.S. businesses and likes businesses in which it is easy to see “value add” for the customer. We would expect deals of significance, at least $10bn, to be a threshold. In addition, while Mr. Buffett has a reputation for value investing, he is not known for buying “broken” companies in need of restructuring.
