Sokol Resigns, Ending Buffett Successor Talk
A top executive of Berkshire Hathaway Inc., who was believed to have had the inside track to one day succeed billionaire Warren Buffett as CEO, has suddenly resigned.
Buffett said today (March 30) that David Sokol’s resignation letter, delivered by his assistant late Monday, came as a “total surprise,” the Associated Press reported.
Buffett said Sokol, who had been serving as chairman of Berkshire’s MidAmerican Energy, NetJets and Johns Manville units, indicated that he wants to spend more time on philanthropy.
Berkshire Hathaway is the parent company of Forest River Inc., the nation’s second largest RV manufacturer. It reported 2010 sales of nearly $2 billion.
“As I have mentioned to you in the past, it is my goal to utilize the time remaining in my career to invest my family’s resources in such a way as to create enduring equity value and hopefully an enterprise which will provide opportunity for my descendents and funding for my philanthropic interests,” Sokol wrote. Buffett said twice before, most recently about two years ago, Sokol had spoken to him of resigning for similar reasons but Buffett and other board members convinced him to stay with the company. He has accepted Sokol’s resignation this time.
Buffett did said that he learned earlier this month that Sokol bought nearly 100,000 shares of Lubrizol stock before recommending that Berkshire buy the chemical company. Buffett said he doesn’t believe those stock purchases were illegal, and didn’t ask Sokol to resign.
Buffett has regularly praised Sokol’s work, and many investors have speculated that Sokol was on the short list to succeed Buffett at the Omaha, Neb.-based company.
Due to Sokol’s departure, Buffett said Greg Abel, current president and CEO of MidAmerican Holding Co., will become its chairman; Todd Raba, president and CEO of Johns Manville, will become its chairman; and Jordan Hansell, President of NetJets, will become that unit’s chairman and CEO.
Buffett declined to comment beyond his statement. Sokol did not immediately respond to a message left Wednesday.