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Warren Buffett Bidding for Yahoo Assets with Quicken Loans Founder
- hkmurakami 10y agoBuffet buying a stake in a technology company. Never thought I'd see the day.
- godzillabrennus 10y agoHe bought into ibm
- pyvpx 10y agoI know they have a quantum computer, Watson AI, and that Power architecture...but isn't IBM primarily a sales and consulting company? at least, by revenue and headcount?
- biofox 10y agohttps://en.wikipedia.org/wiki/IBM_Research https://en.wikipedia.org/wiki/IBM_Research According to Wikipedia, they are also the world's largest industrial research organization.
- orbifold 10y agoIBM spends a lot of money on research and development, as far as I can tell they just usually exit markets that don't have high margins.
- abhi3 10y agoIs yahoo really a technology company? IMO it's more of a media company.
- fma 10y agoAnything that publishes content for public consumption to get advertising revenue is a media company. Google publishes search results to get ads. Facebook published your information for ads. Twitter publishes your tweets for ads. I heard on the radio that someone proclaimed Facebook is now a media company...no, they've always been a media company.
- bbody 10y agoUnlike most technology companies, IBM has been around since before Warren was born. But in general he doesn't buy into technology companies, he is well quoted in that regard.
- charlesdm 10y agoHe probably realised they're going to sell it for nothing close to its actual value.
- rebelde 10y agoIn many respects, Yahoo is more of a publisher, a content provider, than a tech company. That makes it more like the newspaper business that he knows well.
- siscia 10y agoIt sound as a good news for everybody. Buffett is know for not putting too much pressure on his investments giving them the time to grow and be profitable. It is a strategy that worked pretty well, however a technology company is a different beast from the other companies in the Hathaway portfolio (winner takes it all/most), said so Yahoo can still an important player with the right management.
- ghshephard 10y agoMore detail here: http://www.bloomberg.com/news/articles/2016-05-13/buffett-backs-group-bidding-for-yahoo-assets-reuters-reports http://www.bloomberg.com/news/articles/2016-05-13/buffett-ba... Buffet isn't bidding for the group, it wouldn't be part of the Hathaway portfolio. He's just providing the financial backing for Dan Gilbert.
- nabla9 10y agoIt seems that Buffett is helping finance the offer. He might not be the part of the consortium. He may have arranged a loan for them. That would be more the style of Buffet. Selling pickaxes during a gold rush. He rarely invests directly in technology companies. >The consortium is in the second round of bidding in the auction for Yahoo's assets, the people said. Buffett is helping finance the offer, one of the people added. http://www.reuters.com/article/us-yahoo-m-a-buffett-idUSKCN0Y42ME http://www.reuters.com/article/us-yahoo-m-a-buffett-idUSKCN0...
- fiatmoney 10y agoYeah, Buffett prefers buying high free cash flow assets, ideally backed by some kind of monopoly or other barrier to entry, and then using the cheap money to offer exactly this kind of financing. Buying Yahoo assets themselves wouldn't be at all his style.
- tacos 10y agoYup, he buys well-run companies then leaves the managers to do their thing, offering capital when needed. Yahoo is the most anti-Buffett company on Earth. This is more like when he loaned money to GE. Hope this bid wins, I always love learning how he structures his deals.
- throwaway5752 10y agoExplain his buying newspapers! (I'm being tongue in cheek, I understand how they fit into his cash flow/moat profile). Yahoo! assets could be understood through that lens. Agree, it's more likely it's a favorable loan term (perhaps what he did with GS - high coupon preferred redeemable for common).