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- Warren Buffett shared an unfortunate anecdote in his annual shareholder letter.
- One of Berkshire Hathaway’s businesses, Lubrizol, suffered a fire last year.
- Luckily for Lubrizol, insurance will cover a lot of its losses.
- Unluckily for Buffett, Berkshire owns one of the key insurers that will pay out to Lubrizol.
- “The Bible instructs us to ‘Let not the left hand know what the right hand doeth,’ Buffett wrote. “Your chairman has clearly behaved as ordered.”
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Lubrizol — an oil-additives specialist which Buffett’s Berkshire Hathaway conglomerate acquired for $9 billion in 2011 — suffered “significant property damage” and “major disruption” after a fire spread to one of its French plants in September, the billionaire investor wrote.
Luckily for Lubrizol, insurance will cover a big chunk of its losses. However, that isn’t such good news for Buffett.
“One of the largest insurers of Lubrizol was a company owned by . . . uh, Berkshire,” he wrote.
“In Matthew 6:3, the Bible instructs us to ‘Let not the left hand know what the right hand doeth,’ Buffett continued. “Your chairman has clearly behaved as ordered.”
Buffett included the Lubrizol fiasco to underscore the broad scope of Berkshire’s operations. The holding company — which inspired Google-parent Alphabet and Japanese conglomerate SoftBank — counts See’s Candies, Nebraska Furniture Mart, NetJets, and Precision Castparts among its businesses.