u8Zcc

Recommendations

Info

Notes to Consolidated Financial Statements (Continued) (22) Contingencies and Commitments (Continued) We have owned a controlling interest in Marmon Holdings, Inc. (“Marmon”) since 2008 when we acquired 63.6% of its outstanding shares of common stock. In 2010, we acquired 16.6% of its outstanding common stock for approximately $1.5 billion and in 2012, we acquired an additional 9.8% of its outstanding common stock for aggregate consideration of approximately $1.4 billion. In 2013, we acquired an additional 9.7% of its outstanding common stock for aggregate consideration of approximately $1.47 billion of which $1.2 billion is payable in March 2014. As of December 31, 2013, we own substantially all of Marmon outstanding common stock. On April 29, 2013, we acquired the remaining noncontrolling interests of IMC International Metalworking Companies B.V., the parent company of Iscar, for consideration of $2.05 billion. Berkshire now owns 100% of IMC International Metalworking Companies B.V. Each of these transactions was accounted for as an acquisition of noncontrolling interests. The differences between the consideration paid or payable and the carrying amounts of these noncontrolling interests were recorded as reductions in Berkshire’s shareholders’ equity and aggregated approximately $1.8 billion in 2013 and $700 million in 2012. Pursuant to the terms of shareholder agreements with noncontrolling shareholders in our other less than wholly-owned subsidiaries, we may be obligated to acquire their equity ownership interests. If we had acquired all outstanding noncontrolling interests as of December 31, 2013, we estimate the cost would have been approximately $3.1 billion. However, the timing and the amount of any such future payments that might be required are contingent on future actions of the noncontrolling owners. On October 16, 2013, Marmon announced it entered into an agreement to acquire the beverage dispensing and merchandising operations of British engineering company, IMI plc for approximately $1.1 billion. The acquisition closed in January 2014. On December 30, 2013, we entered into an agreement with Phillips 66 (“PSX”) whereby we would exchange up to the 20,668,118 shares of PSX common stock that we owned on that date for 100% of the outstanding common stock of PSX’s flow improver business, Phillips Specialty Products Inc. (“PSPI”). Per the agreement, the exact number of shares of PSX common stock to be exchanged was to be determined based upon the volume weighted average price of PSX common stock on the closing date. On February 25, 2014, the closing occurred and we exchanged 17,422,615 shares of PSX common stock for the outstanding common stock of PSPI. At the time of the closing, the assets of PSPI included approximately $450 million of cash and cash equivalents. Berkshire has a 50% interest in a joint venture, Berkadia Commercial Mortgage (“Berkadia”), with Leucadia National Corporation (“Leucadia”) having the other 50% interest. Berkadia is a servicer of commercial real estate loans in the U.S., performing primary, master and special servicing functions for U.S. government agency programs, commercial mortgagebacked securities transactions, banks, insurance companies and other financial institutions. A significant source of funding for Berkadia’s operations is through the issuance of commercial paper. Repayment of the commercial paper is supported by a $2.5 billion surety policy issued by a Berkshire insurance subsidiary. Leucadia has agreed to indemnify Berkshire for one-half of any losses incurred under the policy. As of December 31, 2013, the aggregate amount of Berkadia commercial paper outstanding was $2.47 billion. 62
Notes to Consolidated Financial Statements (Continued) (23) Business segment data Our reportable business segments are organized in a manner that reflects how management views those business activities. Certain businesses have been grouped together for segment reporting based upon similar products or product lines, marketing, selling and distribution characteristics, even though those business units are operated under separate local management. The tabular information that follows shows data of reportable segments reconciled to amounts reflected in our Consolidated Financial Statements. Intersegment transactions are not eliminated in instances where management considers those transactions in assessing the results of the respective segments. Furthermore, our management does not consider investment and derivative gains/losses or amortization of purchase accounting adjustments related to Berkshire’s acquisition in assessing the performance of reporting units. Collectively, these items are included in reconciliations of segment amounts to consolidated amounts. Business Identity GEICO General Re Berkshire Hathaway Reinsurance Group Berkshire Hathaway Primary Group BNSF Clayton Homes, XTRA, CORT and other financial services (“Finance and financial products”) Marmon McLane Company MidAmerican Business Activity Underwriting private passenger automobile insurance mainly by direct response methods Underwriting excess-of-loss, quota-share and facultative reinsurance worldwide Underwriting excess-of-loss and quota-share reinsurance for insurers and reinsurers Underwriting multiple lines of property and casualty insurance policies for primarily commercial accounts Operates one of the largest railroad systems in North America Proprietary investing, manufactured housing and related consumer financing, transportation equipment leasing and furniture leasing An association of approximately 160 manufacturing and service businesses that operate within 11 diverse business sectors Wholesale distribution of groceries and non-food items Regulated electric and gas utility, including power generation and distribution activities in the U.S. and internationally; domestic real estate brokerage 63
Page 1 and 2:
BERKSHIRE HATHAWAY INC. 2013 ANNUAL
Page 3 and 4:
BERKSHIRE HATHAWAY INC. 2013 ANNUAL
Page 5 and 6:
BERKSHIRE HATHAWAY INC. To the Shar
Page 7 and 8:
Š While Charlie and I search for e
Page 9 and 10:
Intrinsic Business Value As much as
Page 11 and 12:
One venture materialized last June
Page 13 and 14: Regulated, Capital-Intensive Busine
Page 15 and 16: Ron Peltier continues to build Home
Page 17 and 18: I can’t resist, however, giving y
Page 19 and 20: Berkshire has one major equity posi
Page 21 and 22: Š My two purchases were made in 19
Page 23 and 24: A couple of interesting sidelights
Page 25 and 26: About 1:15 p.m. on Sunday, I will b
Page 27 and 28: BERKSHIRE HATHAWAY INC. ACQUISITION
Page 29 and 30: REPORT OF INDEPENDENT REGISTERED PU
Page 31 and 32: BERKSHIRE HATHAWAY INC. and Subsidi
Page 35 and 36: Notes to Consolidated Financial Sta
Page 63: Notes to Consolidated Financial Sta
Page 71 and 72: Management’s Discussion (Continue
Page 105 and 106: In June 1996, Berkshire’s Chairma
Page 107 and 108: Besides, Berkshire has access to tw
Page 109 and 110: INTRINSIC VALUE Now let’s focus o
Page 111 and 112: BERKSHIRE HATHAWAY INC. INTRINSIC V
Page 113 and 114: BERKSHIRE HATHAWAY INC. OPERATING C
Page 115 and 116:
BERKSHIRE HATHAWAY INC. DAILY NEWSP
Page 117 and 118:
115
Page 119 and 120:
117
Page 121 and 122:
119
Page 123 and 124:
121
Page 125 and 126:
123
Page 127 and 128:
125
Page 129 and 130:
127
Page 131 and 132:
129
Page 133 and 134:
131
Page 135 and 136:
133
Page 137 and 138:
135
Page 139 and 140:
BERKSHIRE HATHAWAY INC. DIRECTORS W
show all

u8Zcc

You also want an ePaper? Increase the reach of your titles

Delete template?

Save as template?