Yahoo Finance The big question ahead of Berkshire Hathaway's 2022 meeting: End of an era?
Legendary investors Warren Buffett and Charlie Munger are both past 90 years old, and experts say it wouldn't be surprising if they retired at Saturday's Berkshire Hathaway shareholders meeting.
Munger already stepped down as chairman of the Daily Journal Corp. in March after 45 years in that role.
"Well, I wouldn't be shocked," Bill Smead, CIO at Smead Capital Management, told Yahoo Finance. "For Charlie to step down at Daily Journal tells me that he's just not comfortable, so that wouldn't be shocking. And Warren isn't really running the business side of the business."
The Oracle of Omaha and his longtime business partner, Munger, will appear together this Saturday during Berkshire Hathaway's (BRK-A, BRK-B) annual meeting. Forty thousand shareholders are expected to descend upon Omaha, in the first time it's being held in person since the onset of the pandemic. The possibility of Munger's retirement may be more imminent given that he's older.
"While I expect his role in terms of being a Warren Buffett confidante will continue as long as he's able to, I wouldn't be shocked if he stepped away from being a vice chairman and took on a more informal role," Glenn Tongue, managing partner at Deerhaven Capital, told Yahoo Finance.
Buffett, 91, and Munger, 98, started holding the shareholder meeting decades ago, and it's since become known as "Woodstock for capitalists." Shareholders come from all over the world to enjoy Berkshire-held company offerings like See's Candies, Coca-Cola and Dairy Queen.
Replacing Buffett and Munger
Over the last two years, Buffett and Munger have made their succession plan clear to investors, by installing four key executives at the helm of the conglomerate: Greg Abel, who heads Berkshire Hathaway Energy and is likely to become CEO, Ajit Jain, who oversees the insurance business, and investment managers Todd Combs and Ted Weschler.
“The directors are in agreement that if something were to happen to me tonight, it would be Greg who’d take over tomorrow morning,” Buffett told CNBC in 2021.
Abel, who's 59 years old, is a Canadian businessperson with extensive experience in the energy sector, while 70-year-old Jain has worked in Berkshire's insurance business for many years.
"I think the succession plan makes sense — while both Greg Abel and Ajit Jain are extremely capable, Abel’s broader industrial experience seems more relevant to the broader swathes of Berkshire’s businesses than Jain’s insurance experience," Meyer Shields, an analyst covering the company at Keefe, Bruyette & Woods, told Yahoo Finance in an email.
"Jain is also older (and concerns about his successor could explain Berkshire’s latest acquisition), and I think Berkshire wants another multi-decade CEO as a means of preserving corporate culture," Shields added.
Ultimately, "no one can replace Charlie, no one can replace Warren," Tongue stressed.
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Aarthi is a reporter for Yahoo Finance. She can be reached at aarthi@yahoofinance.com. Follow her on Twitter @aarthiswami.
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