NetJets Unrest Puts Warren Buffett in a Rare Pinch

[FamilyGuy]

http://www.wsj.com/articles/netjets-unrest-puts-warren-buffett-in-a-rare-pinch-1420485740

 

[gunfyter]

entered in error

 

[CALRepublic]

I read that article this morning.

Mr B. Once said "two reasons to get rid of a wholly owned company, the business is unprofitable and/or labor unrest". We've given him lots of the latter

Berkshire Hathaway had profits of $16 billion USD in 2014, and about a $60 billion cash hoard that Mr. B doesn't know what to do with. He could dump us and not even feel it

 

[T-1GUY]

FlightSafety (another Berkshire company) would take it in the shorts if he sold which he is not about to do.

 

[FamilyGuy]

I read that article this morning.

Mr B. Once said "two reasons to get rid of a wholly owned company, the business is unprofitable and/or labor unrest". We've given him lots of the latter

Berkshire Hathaway had profits of $16 billion USD in 2014, and about a $60 billion cash hoard that Mr. B doesn't know what to do with. He could dump us and not even feel it

The challenge in selling NetJets is how do you value it without Berkshire's backing? So many owners are with NJ because it is owned by Buffett and has his stamp of approval. If you take that away, it is worth a lot less.

 

[FamilyGuy]

FlightSafety (another Berkshire company) would take it in the shorts if he sold which he is not about to do.

Flightsafety has plenty of demand for their slots, so I don't see a big negative impact if NJ were sold. I also don't see Buffett being concerned about that small impact. If he wants to sell it he will. For the record, I don't think a sale is likely at this point.

 

[NJAowner]

Wind down?

Maybe he just declares that the concept isn't financially viable and winds it down over 5 years. The write off is immaterial to BH's financial statements and results in a tax savings at the same time. He has had some blunders in the past which were much more costly which investors do not seem to have held against him.

"Discuss amongst yourselves."

 

[T-1GUY]

I agree that Netjets is just a pimple on his ass. If he wants to close it he could. I don't believe he will for a second. Netjets makes money and is a market leader. He also has a fiduciary responsibility to his shareholders. The contracts will get signed and a new CEO will be brought onboard. This is all posturing and scare tactics.

 

[T-1GUY]

Flightsafety has plenty of demand for their slots, so I don't see a big negative impact if NJ were sold. I also don't see Buffett being concerned about that small impact. If he wants to sell it he will. For the record, I don't think a sale is likely at this point.

Almost 3,000 recurrents every six months, year in, year out. If I bought Netjets I would be on the phone to CAE Simuflite the very next day asking them if they would like to bid for those slots. To say that this wouldn't have a negative effect on flightSafety would be naive.

 

[CRAWDADDY]

I could be talked into accepting the Four Pillars (or whatever they're calling it this week) if Buffett was taken out.