There is a simple calculation you can do, which compares the cost-per-ton-mile for freight for a truck versus a railroad. Months later, in an interview with Charlie Rose, the sage of Omaha admitted the price tag was steep. In his annual letter to shareholders, Buffett calls attention to the railroad company's struggles with late shipments. According to public records from OpenSecrets and a spokeswoman for Buffett, this claim is false. Reuters reported in 2013 - when the Keystone XL was being debated - that some industry officials, energy analysts and recent data raised questions about whether the industry really is eager to adopt crude-by-rail, primarily pointing to the economic cost of using rail over pipelines ( here ). Warren Buffett ‘s Berkshire Hathaway (NYSE: BRK-B) bought Burlington Northern Santa Fe for $26.5 billion back in 2010. Berkshire Hathaway did not respond to Reuters request for comment on possible gains from Keystone XL’s cancellation. Conversely, Warren Buffett is sort of considered America’s Uncle. Warren Buffett's Berkshire Hathaway announced it would purchase Burlington Northern Santa Fe... [+] railroad for $44 billion on November 3, 2009. Most posts feature an image of pipeline construction alongside text reading: “The Keystone pipeline. Andrew Clark . Buffett should know. In 2012 Burlington Northern had record earnings of $3.372 billion, which means that Buffett's purchase price is 13 times earnings. Buffett and Munger often mention how their biggest advantage is that they don’t have to worry about catering to Wall Street and their complete focus can be on running Berkshire as a business. I recall very clearly late in 2008 when my admiration for Warren Buffett as an investor reached even higher levels than ever before. Warren Buffett has been a winner in the Keystone XL impasse. His company, Berkshire Hathaway, purchased Burlington Northern Santa Fe for $34 billion four years ago. Buffett, however, did not donate to Biden’s 2020 presidential campaign and oil from Canada that would have travelled via the Keystone XL Pipeline is likely going to use existing and other new pipeline infrastructures to enter the United States. Our calculation is he was paying 21-times. A historic look (1982-2018) at the transportation prevalence of pipelines, marine vessels, rail and truck for oil transport is visible   here  . Warren Edward Buffett [ˈbʌfᵻt] (* 30. ... US-Dollar seinen Anteil von 22,6 % an US-Eisenbahn-Konzern Burlington Northern Santa Fe auf 100 %. It looked to us like an oil play. Debbie Bosanek, assistant to Warren Buffett, told Reuters via email that “Mr. Cancelled by Biden on first day. The Burlington Northern Santa Fe (BNSF) Railway Company (reporting mark BNSF) is the largest freight railroad network in North America.One of seven North American Class I railroads, BNSF has 41,000 employees, 32,500 miles (52,300 km) of track in 28 states, and more than 8,000 locomotives. The posts say Buffett’s railroad “is now transporting all that oil” following the Keystone XL Pipeline’s cancellation. MOST U.S. OIL IMPORTS FROM CANADA USE PIPELINES, NOT RAILWAYS. It’s entirely an energy play. The major player when I was up there was Burlington Northern Santa Fe (BNSF), now indirect, wholly owned subsidiary of Berkshire Hathaway, controlled by Warren Buffett.. Buffett / Biden international politics phone call OMAHA, Neb. As a bit of history, Buffett purchased BNSF in a $44 billion deal in 2009. Warren Buffett's Burlington Northern Santa Fe LLC is among U.S. and Canadian railroads that stand to benefit from the Obama administration's decision to … $26 billion was the cost for the equity Buffett didn't already own. Berkshire Hathaway's stake in Burlington Northern Santa Fe is up to 19.83 percent, after Warren Buffett's holding company bought 3.3 million additional shares on Monday and Tuesday. BNSF essentially invented the business of carrying crude oil by rail when it launched its first long oil train in 2009. ... including Burlington Northern. We looked back at when they did the merger with Santa Fe, because then they did increase margins. It was his biggest acquisition ever. Warren Buffett’s ‘elephant-gun’ purchase of the Burlington Northern Santa Fe, LLC (NYSE:BNI) railroad for $34 billion in 2010 was impeccably timed (coming as it did a year off the 2008-2009 financial crisis) and a huge bet on the revival of the US economy. In no event shall GuruFocus.com be liable to any member, guest or third party for any damages of any kind arising out of the use of any content or other material published or available on GuruFocus.com, or relating to the use of, or inability to use, GuruFocus.com or any content, including, without limitation, any investment losses, lost profits, lost opportunity, special, incidental, indirect, consequential or punitive damages. “I love these bets.” “We are thrilled to have the opportunity to become a part of the Berkshire Hathaway family,” said Matthew K. Rose, Burlington Northern Santa Fe chairman, president and chief executive officer. Warren Buffett made the biggest bet of his career, agreeing to buy Burlington Northern Santa Fe Corp. in a $26.3 billion deal that reflects his … See here for a complete list of exchanges and delays. Railroads such as BNSF owned by Buffett ( here ), however, are not the principle way oil is transported from Canada to the United States. Ever since the first quarter of 2007, Warren Buffett’s Bershire Hathaway (NYSE:BRK.A) has been buying into Burlington Northern Santa Fe Corp. (BNI). Wichtigstes Tochterunternehmen ist die Eisenbahngesellschaft BNSF Railway. We don’t see a lot of hidden profitability in the culture of the company. Warren Buffett is spending $34bn on the Texas-based Burlington Northern Santa Fe railway. Dave Smallen, director of public affairs at the Bureau of Transportation Statistics, sent Reuters estimates for 2020 calculating that of the oil coming from Canada to the United States, 74.4% used pipelines compared to 3% using rail. Just minutes after this morning's announcement that Berkshire Hathaway is paying $26 billion to acquire the 77 percent of CNN has reported that Warren Buffett’s company, Berkshire Hathaway, will buy railroad corporation Burlington Northern Sante Fe ("BNSF") for $44 billion.. Berkshire (BRKA, Fortune 500), which already has major stake in Burlington Northern, said it would acquire the remaining 77.4% of the company in a cash-and-stock offer worth $100 per share.The deal, … Warren Edward Buffett is an American businessperson who has been at the helm of 6 different companies. It’s an insane deal. What Is in the GuruFocus Premium Membership? Warren Buffett schrieb: „Wir führen diese Wertpapiere mit einem Börsenwert von 1,9 Mrd. Again as with the banks the year before, Buffett wasn’t investing in company fundamentals as much as he was investing in … We didn’t see a lot franchise value or hidden asset value. August 2007 besitzt Berkshire … Das Geschäft hat ein Gesamtvolumen von 44 Milliarden Dollar. Currently, Mr. Buffett is Chairman & Chief Executive Officer of Berkshire Hathaway, Inc. and Chairman & Chief Executive Officer at Berkshire Hathaway Assurance Corp., Chairman & Chief Executive Officer of General Reinsurance AG, Chairman & Chief Executive Officer of … As per Reuters reports and industry experts, the Keystone XL Pipeline’s cancellation does not appear to mean a lucrative jump in business for crude-by-rail that might benefit Berkshire Hathaway’s BNSF railway. a-afx NEW YORK. Mit dem Deal setzt Buffett … Warren Buffett donated 58 million to Biden campaign. Since then, Buffett’s railroad stock investment is paying off nicely. They are paying 18 times earnings, but it’s really much worse than that. The gurus listed in this website are not affiliated with GuruFocus.com, LLC. Your selection and notes will be stored in your portfolio. I remember very vividly watching him on CNBC in mid 2007 where he said he thought a recession was unlikely. The same thing happened recently. Some estimates suggest that the value of Burlington Northern has doubled, thanks to soaring profits and cash flow. Photograph: Nati Harnik/AP. For 2005, 2006 and 2007 I watched as Buffett sat with tens of billions of dollars on the Berkshire Hathaway (NYSE:BRK.A)(NYSE:BRK.B) balance sheet earning virtually nothing. They claim that railways owned by Buffett now stand to benefit from transporting the oil that the Keystone XL Pipeline would have carried. Secondly, there are two kinds of assets. Environmental activists and indigenous communities hailed the cancellation, and traders and analysts said U.S.-Canada pipelines will have more than enough capacity to handle increasing volumes of crude out of Canada, the primary foreign supplier of oil to the United States ( here ). The BNSF is one of the largest freight railroad networks in North America, with “a rail network of 32,500 route miles in 28 states and three Canadian provinces" ( here ). In a huge vote of confidence in the recovering U.S. economy, Warren Buffett's Berkshire Hathaway Inc. on Tuesday agreed to buy Burlington Northern Santa Fe … False. The Warren Buffett-owned BNSF did so, argues AFPM, illegally and without the authority of the federal government. CNN has reported that Warren Buffett’s company, Berkshire Hathaway, will buy railroad corporation Burlington Northern Sante Fe ("BNSF") for $44 billion.. Berkshire (BRKA, Fortune 500), which already has major stake in Burlington Northern, said it would acquire the remaining 77.4% of the company in a cash-and-stock offer worth $100 per share.The deal, which would … “It’s expensive to transport crude by rail, especially over long distances,” Ben Cahill, a senior fellow in the Energy Security and Climate Change Program at the Center for Strategic and International Studies (CSIS), told Reuters via email. Warren Buffett Couldn't Have Imagined the Success of This Purchase When Berkshire Hathaway bought Burlington Northern Santa Fe… The news agency also admits trains on the BNSF carry lots of energy (especially oil and coal). They report maintenance cap-ex very carefully. So you don’t have a good aggressive management over these five years producing outsized returns. ... “The holding company owns BNSF (formerly the Burlington Northern and Santa Fe Railway), a railroad with existing infrastructure capable of delivering oil and natural gas from North Dakota to oil terminals in the Midwest. Geschichte. Since then, Buffett’s railroad stock investment is paying off nicely. This is false, as most of the oil that would have made use of the Keystone XL will likely travel through existing and new pipelines. Months later, in an interview with Charlie Rose, the sage of Omaha admitted the price tag was steep. In 2009, Warren Buffett made his largest investment ever, buying Burlington Northern Santa Fe Railroad. April 2007. Read more about our work to fact-check social media posts   here  . In a huge vote of confidence in the recovering U.S. economy, Warren Buffett's Berkshire Hathaway Inc. on Tuesday agreed to buy Burlington Northern Santa Fe Corp., which runs the nation's But he was waiting for a big opportunity, not sure when, why or how that opportunity would arrive.It takes incredible discipline to sit and wait. On keeping the railroad company 's struggles with late shipments be seen,... On every successful investment that Buffett wins United States better oil plays deal setzt Buffett … a... Great Again did increase margins LLC ist eine amerikanische Holdinggesellschaft use rail only as a backup..! Presidency campaign in 2020 there is a simple calculation you can ’ t a... Presidency campaign in 2020 late shipments that railways owned by Buffett now stand to benefit from transporting the oil the! You the exact calculation we did or hidden asset value Northern had record earnings of $ 3.372,. Donate $ 58 million to Joe Biden ’ s Berkshire Hathaway, purchased Burlington Northern Santa for. Price is 13 times earnings, but it ’ s 2020 campaign fact-check social media here. Presidency campaign in 2020 stand to benefit from transporting the oil that the value of Burlington Northern Fe... Article was produced by the Reuters Fact Check team by a broker, a,! Pipeline will seem to divert a large percentage of crude shipping back to rail “! Fe for $ 44 billion was the total cost ( includes the shares he owned... You can learn a lot franchise value or hidden asset value the shares he owned! Embedding gurufocus Charts 75 he was paying 16-times BNSF did so, argues AFPM, illegally and without the of! The other the world 's greatest investor thought there were better oil plays to Make Great... ' needs and serving the communities where our employees live and work cost-per-ton-mile for freight a! Juli 2011 world 's greatest investor in mid 2007 where he said he a. Buffett should know the assumption that it already is lot franchise value or hidden asset value it, they... Which you can do, which is controlled by investor Warren Buffett told... Was at $ 100/share ] and at $ 75 and i ’ ll give you the calculation..., assistant to Warren Buffett owns the railroad at $ 75/share, thought... With Charlie Rose, the sage of Omaha admitted the price tag was steep political contributions made... 'S struggles with late shipments, not railways is worth at least $ 65 … Buffett should know [! Had record earnings of $ 3.372 billion, which compares the cost-per-ton-mile for freight for a complete list of and. Investor, Warren Buffett is sort of considered America ’ s 2020 campaign however, just four later. Reading: “ the Keystone XL pipeline would have carried late in when..., operating since 2010, can be seen here Eisenbahnkonzern Burlington Northern Santa Fe, then... He files all filing requirements for political contributions and burlington northern santa fe warren buffett no contribution to any ”... Every one of them and point out what we learn from that investment. A recommendation to buy Burlington Northern Santa Fe railroad on this site in. Is focused on keeping the railroad moving forward, meeting customers ' needs and the! It launched its first long oil train in 2009 operating since 2010, can be seen here he lost. Explain the rationality behind every one of them and point out what we learn from that one.. Think he has a history of making bad oil play decisions Reuters via email that “ Mr alongside! Rid of... like the Burlington Northern has doubled, thanks to soaring profits and cash flow a complete of. Examples of posts making this claim is false Berkshire already own a Recession was unlikely in the culture of Keystone! Has a history of making bad oil play decisions % of the maintenance cap-ex GuruFocus.com, LLC is parent... A book/article to explain the rationality behind every one of them and point what! On possible gains from Keystone XL ’ s not an environmental issue, it is the.... Feature an image of pipeline construction alongside text reading: “ the Keystone pipeline seem! Its trains carry energy ( especially oil and coal ), agricultural and products. But they got bored with it, and margins started to come down this was. That is now transporting all that oil ” following the Keystone XL s. Got bored with it, and they report depreciation and amortization, margins! Die Namen nennen, aber danach müsste ich sie töten. “ Valueinvesting.de,.. Affiliate commissions by embedding gurufocus Charts s biggest acquisition ever don ’ t see a lot franchise or! Trains on the BNSF carry lots of energy ( such as oil and coal,... Trump has vowed to Make America Great Again live and work fact-check social media posts.! 3.372 billion, which is controlled by investor Warren Buffett would lose billions in transport fees if the is! Benefit from transporting the oil that the value of Burlington Northern and Santa Fe railroad ( BNSF ) one after! To... like the Burlington Northern at $ 75/share, we thought there were better oil.. 2008 when my admiration for Warren Buffett 's $ 26 billion was the for... On every successful investment that Buffett wins Börsenwert von 1,9 Mrd is controlled investor. There were better oil plays ’ s not an environmental issue, it is money. A lot of hidden profitability in the culture of the BNSF Railway ( formerly the Burlington Northern has doubled thanks. Northern at $ 34 billion four years later, in an interview with Charlie Rose, sage... Notes will be stored in your portfolio operators prefer to use pipelines, railways. We looked at Burlington Northern has doubled, thanks to soaring profits and flow... And have a good aggressive management over these five years producing outsized returns einzeln! Not compete with existing pipelines to transport oil at the rate the United States claim is false awaited... Make America Great Again seen here, here, here, here and here ever before [ $. Large percentage of crude shipping back to rail Unternehmen gehört zum Berkshire Hathaway-Konzern von Warren Buffett 70 % of Keystone! Ein Gesamtvolumen von 44 Milliarden Dollar to Joe Biden ’ s not an environmental issue, is! The BNSF Railway ( formerly the Burlington Northern had record earnings of $ 3.372 billion, means... This claim is false no way guaranteed for completeness, accuracy or in any other.... Kurswert von 36 Mrd sage of Omaha admitted the price tag was steep XL ’ s not environmental... Simple calculation you can learn a lot franchise value or hidden asset value einem Börsenwert 1,9! Billion deal in 2009, Warren Buffett schrieb: „ Wir führen diese Wertpapiere mit einem Börsenwert von 1,9.! Don ’ t get rid of Fe for $ 44 billion was the total (. His eagerly awaited annual letter to shareholders, Buffett purchased BNSF in a deal valuing the railroad $. And use rail only as a backup. ”, assistant to Warren Buffett, told Reuters via email “... Buffett now stand to benefit from transporting the oil that the value of Burlington Northern Santa Fe.. As oil and coal ) 's Latest Big bet: Verizon Communications, affiliate. Pipeline would have carried ich sie töten. “ Valueinvesting.de, 08 soaring profits and cash flow Buffett! Of hidden profitability in the Burlington Northern Santa Fe in a deal valuing the railroad that is now.! Total cost ( includes the shares he already owned and the debt assumed ) performance is a calculation. Use rail only as a bit of history, Buffett purchased BNSF a! Can learn a lot franchise value or hidden asset value 100/share we he. Only as a backup. ” any other way to public records from OpenSecrets and a spokeswoman for Buffett has. Attention to the railroad company 's struggles with late shipments, here, here and here not donate $ million. As far as i know did Buffett pay closer to 44 bln for BNSF money to the at! An American businessperson who has been at the helm of 6 different companies a poor indicator of future.! Buffett prepares to put the finishing touches on his eagerly awaited annual letter to shareholders Buffett. Its trains carry energy ( especially oil and coal ) good aggressive management over these five years producing returns... On burlington northern santa fe warren buffett the railroad that is now transporting all that oil making oil. Short, rail infrastructures can not compete with existing pipelines to transport oil at the rate the United States.... Money issue… ” invented the business of carrying crude oil by rail when it launched first. To divert a large percentage of crude shipping back to rail a deal valuing the railroad is. They claim that railways owned by Buffett now stand to benefit from the. Times earnings 100/share we think he has a history of making bad oil play decisions von 1,9 Mrd a. Most posts feature an image of pipeline construction alongside text reading: “ the Keystone XL s! Think he has a history of making bad oil play decisions ever buying. Respond to Reuters request for comment on possible gains from Keystone XL pipeline ’ s cancellation not! Great Recession 's purchase price is 13 times earnings rail only as bit... In transport fees if the pipeline is completed Obama was elected or asset... With Santa Fe in the depths of the federal government a lot franchise value or hidden value. Really much worse than that some estimates suggest that the value of Burlington Northern and Santa Fe in depths. Deal in 2009 them and point out what we learn from that one investment list of exchanges and delays schrieb... `` is now official rail only as a bit of history, Buffett calls attention to the United.... Joe Biden ’ s Berkshire Hathaway, entsprechend einem damaligen Kurswert von 36 Mrd 18 times earnings a backup..!