Warren Buffett is giving up the last formal power he held at Berkshire Hathaway. In a letter to shareholders published on Friday, the 96 year old investor announced he is stepping down as chairman after six decades, in language that had the feel of a man making peace with arithmetic. Father Time always wins, he wrote, as the BBC reported.
The move completes one of the longest transitions in corporate history. Buffett took control of Berkshire, then a struggling textile mill, in 1965, and turned it into a global conglomerate spanning insurance, rail, energy and retail. Greg Abel, the company’s vice chairman, replaced him as chief executive, and has since run day to day operations.
Buffett said in the letter that he is stepping aside partly because Abel has exceeded his expectations, CNN Business reports. Abel was direct in his own response. Warren’s impact on Berkshire and its owners is without parallel in the history of American business, he said in a statement, according to the Guardian.
Under the plan, Buffett remains on the board as chairman emeritus, while his eldest son Howard takes over as non executive chairman. The succession settles a question that has hovered over Berkshire shareholders for years, and removes the ambiguity of a dual structure that was always intended to be temporary.
For UK and European investors the story is less about sentiment than portfolio mechanics. Berkshire holds a large and famously patient cash pile, and its stance on major holdings is watched as a signal of where the next downturn might bite. Analysts will now read Abel’s first full annual letter, early next year, as the real statement of intent for the post Buffett era.
The markets reaction on Friday was orderly. Berkshire shares drifted rather than plunged, which is perhaps the strongest evidence that the succession was as prepared as its founder claimed. Sixty years at the top of American business end, in the end, with a letter and a handover.