Berkshire Hathaway 2018 Annual Meeting Audience Question # 50

Warren admits Berkshire is still not very well known to business owners looking to sell outside the United States

Warren Buffett:

Gary.

Gary Ransom:

Yes, you’ve said that you are looking for non-insurance large acquisitions to put that cash to work. And when you’ve said that, I’ve usually thought of the United States, because you’re a big fan of the U.S. business.

And I just was wondering whether you’re seeing more opportunities as the rest of the world opens up, grows, whether there’s opportunities for some of those mega-transactions in other parts of the world, say Asia or Europe.

Warren Buffett:

Yeah, Gary, I would say that I’ve been disappointed in that, because we do see some outside the United States, and thank heavens we saw the one we saw in Israel some years ago when Eitan wrote me a letter. But… and you know, we bought a business which is a very important part of Berkshire now.

But we are still not… they’re certainly aware of Berkshire Hathaway outside the United States.

But they don’t sort of pick up the phone automatically.

In the United States, I think any large… particularly private… company that thinks… is thinking about doing something, they at least think about Berkshire. But that… in Europe or Asia, that… we are not embedded in the minds the same way.

They know about us, they know we’ve got a lot of money and they know we like to buy things.

But we really, we’re on the radar screen big-time in the United States, and we’re not as… we don’t… the immediate desire to be sure that they’ve thought about the Berkshire option does not occur the same way outside the United States. And we’ve tried to encourage it a few ways.

But I would say that the results have not been great at all.

But I hope tomorrow, you know, I get a call from Germany or Britain or Italy or you name it, and Australia, wherever it may be. And I hope I get a call and we get an opportunity to do it.

There’s a good many countries we’d be quite happy to put substantial money into it. And like I say, our experience in Israel has been just terrific.

Charlie?

Charlie Munger:

Yeah, but the corporate acquisition game now is so driven by the leveraged buyout and the so-called, whatever they call them, strategic, yes, strategic. I usually translate that into barnyard language.

And we’re so… there’s so much craziness in price from our viewpoint. Of course, it’s very hard for us to do it.

The people in the leveraged buyout game, who love massive leverage and don’t mind high prices, even they are getting nosebleeds. It’s hard. And it’s not an environment that means that
…that allows Berkshire just to go out and buy a whole lot of companies.

Warren Buffett:

Have you ever made a strategic deal that you…

Charlie Munger:

We have to wait.

Warren Buffett:

We’ve made a strategic deal that you can remember?

Charlie Munger:

Hmm?

Warren Buffett:

Have we ever made a deal that we would have regarded as strategic?

Charlie Munger:

We’ve never had a strategic plan unless you’ve hidden it from me.

Warren Buffett:

OK. That answers that.

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