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Buffett gives $37 billion to Gates and family foundations

June 25, 2006

By Robert MacMillan and Mark McSherry

NEW YORK (Reuters) – Warren Buffett, the world’s
second-richest person, is donating about $37 billion — more
than 80 percent of his fortune — to foundations run by his
friend Bill Gates and by the Buffett family.

The move is the biggest-ever single act of charitable
giving in the United States.

Sunday’s announcement by Buffett, 75, comes just days after
Microsoft Chairman Gates said he would move away from his
day-to-day role at the software giant to focus more on charity
work, and highlights the close friendship of the world’s two
richest men.

Gates, 50, is a bridge partner of Buffett’s and a director
of Berkshire Hathaway, Buffett’s investment firm. Buffett
serves on the board of the Washington Post Co. with Gates’ wife
Melinda.

In a letter to the Bill and Melinda Gates Foundation,
Buffett, said he will set aside 10 million shares of Berkshire
class B common stock for the foundation.

Based on the stock’s per-share price of $3071.01 as of
Friday, the total amount for the Gates foundation comes to
about $30 billion.

That is the largest commitment to a philanthropic cause
ever made by one person in the United States, said Stacy
Palmer, editor of the Chronicle of Philanthropy.

“Even if you look at what (John D.) Rockefeller and
(Andrew) Carnegie gave historically — even if you do it in
today’s numbers, it doesn’t come close to that,” she said.

The Gates foundation is one of the world’s richest
philanthropic organizations.

It has committed millions of dollars to fighting diseases
such as malaria and tuberculosis in developing countries, and
to education and library technology in the United States.

HUMBLE

Buffett, chief executive of Berkshire Hathaway, is worth an
estimated $44 billion, according to Forbes magazine. That makes
him the world’s second-richest man behind Gates, who is worth
about $50 billion.

Buffett took over Omaha, Nebraska-based Berkshire in 1965,
and has transformed it from a struggling textile maker into a
$141.8 billion company with investments in undervalued
securities and purchases of well-managed, easy-to-understand
businesses.

Its stock investments include blue-chip names such as
Coca-Cola Co. and Procter & Gamble Co. Berkshire also owns some
50 businesses, including Geico auto insurance, Benjamin Moore
paint and Dairy Queen ice cream.

In a letter to Gates and his wife, Buffett wrote: “You have
committed yourselves to a few extraordinarily important but
underfunded issues, a policy that I believe offers the highest
probability of your achieving goals of great consequence.”

Gates and his wife said in a statement on their
foundation’s Web site: “We are awed by our friend Warren
Buffett’s decision to use his fortune to address the world’s
most challenging inequities, and we are humbled that he has
chosen to direct a large portion of it to the Bill & Melinda
Gates Foundation.”

Buffett also pledged 1 million shares to a foundation
established by himself and his late wife, Susan Thompson
Buffett, and 350,000 shares each to the foundations of children
Howard, Susan and Peter.

In letters to the recipients, Buffett said he will award
the gifts every year for the rest of his life.

Buffett is in “excellent health,” he wrote to the Gates
foundation, but said he is writing a new will to ensure that
the stock is distributed after his death.


Source: reuters



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