Buffett to Pay $4.5 Billion for Marmon Holdings’ Stake

Billionaire Warren Buffett’s Berkshire Hathaway Inc. will pay $4.5 billion for 60 percent of Marmon Holdings Inc., adding another family run company that prospered without shareholder demands for short-term profits.

Chicago’s Pritzker family, which controls Global Hyatt Corp., built Marmon into a group with $7 billion in annual sales and 125 units including operations serving the railroad and energy industries. Operating income more than tripled from 2002 to 2007, Omaha, Neb.-based Berkshire said Tuesday.

Marmon has “businesses that are fairly niche-oriented where they have dominant positions established over time,” said Thomas Russo, who manages about $3.5 billion at Gardner Russo & Gardner in Lancaster, Pa., and counts Berkshire as its largest holding. “They have a history under the Pritzkers of being liberated from the quarterly earnings game.”

Marmon is “our kind of company,” Buffett said in an interview with CNBC Wednesday. “It’s in some very basic businesses but good businesses.”

Originally published by Bloomberg AP and Staff Reports.

(c) 2007 Tulsa World. Provided by ProQuest Information and Learning. All rights Reserved.