Berkshire Hathaway Inc.
Overview
Berkshire Hathaway is an American multinational conglomerate holding company headquartered in Omaha, Nebraska. The company wholly owns GEICO, Dairy Queen, BNSF Railway, Lubrizol, Fruit of the Loom, Helzberg Diamonds, Long & Foster, FlightSafety International, Pampered Chef, Forest River and NetJets, and also owns 38.6% of Pilot Flying J; and significant minority holdings in public companies Kraft Heinz, American Express, Wells Fargo, The Coca-Cola, Bank of America, and Apple.
History
Berkshire Hathaway traces its roots to a textile manufacturing company established by Oliver Chace in 1839 as the Valley Falls Company in Valley Falls, Rhode Island. In 1929, the company merged with the Berkshire Cotton Manufacturing Company established in 1889, in Adams, Massachusetts, forming Berkshire Fine Spinning Associates. In 1955, Berkshire Fine Spinning Associates merged with the Hathaway Manufacturing Company, which was founded in 1888 in New Bedford, Massachusetts, with Hathaway's CEO Horatio Hathaway having been successful in his first business venture.
Business Model
Berkshire Hathaway follows a unique business model. Unlike most conglomerates that actively manage the companies they own, Berkshire Hathaway is more of a holding company for Warren Buffett's investments. The subsidiaries operate independently and the parent company does not provide any managerial input. This model has been successful in maintaining the entrepreneurial spirit in the subsidiaries.
Subsidiaries and Investments
Berkshire Hathaway owns a diverse range of businesses including confectionery, retail, railroads, home furnishings, encyclopedias, manufacturers of vacuum cleaners, jewelry sales, newspaper publishing, manufacture and distribution of uniforms, and several regional electric and gas utilities.
Financial Performance
Berkshire Hathaway has consistently ranked high on Fortune's 500 list, which ranks corporations by total revenue. The company is known for its control and leadership by Warren Buffett, who serves as chairman and chief executive, and by Charlie Munger, the company's vice chairman.
Criticisms and Controversies
Despite its success and reputation, Berkshire Hathaway has faced several controversies and criticisms over the years. These range from its handling of certain business practices to its environmental record.