Berkshire Hathaway chooses Buffett's successor

Billionaire investor Warren Buffett announced Saturday that a successor has been chosen to lead his Berkshire Hathaway holding company, although he did not identify the person. Buffett, 81, wrote in a letter to investors that Berkshire Hathaway's board of directors chose his successor and two back-up candidates. "When a transfer of responsibility is required, it will be seamless and Berkshire's prospects will remain bright," Buffett wrote. "Do not, however, infer from this discussion that Charlie and I are going anywhere," Buffett said, referring to the firm's Vice Chairman Charlie Munger, who is 88. "We continue to be in excellent health and we love what we do." The company's closely watched investment portfolio has significant holdings in the railroad, retail and utility industries. It allayed some concerns about succession by recently hiring two hedge fund managers, Todd Combs and Ted Weschler. Buffett said that "each will be handling a few billion dollars in 2012, but they have the brains, judgment and character to manage our entire portfolio when Charlie and I are no longer running Berkshire." In the same report, Berkshire Hathaway said its net earnings fell sharply in 2011 but its financial performance still beat the Standard & Poor's 500 on the New York Stock Exchange. The company's annual net income totaled $10.3 billion, or 21 percent less than in 2010 but 27 percent more than in 2009, according to its annual report published online. Buffett prefers to measure his company's performance by changes in its net book value, which assesses gains or losses for shareholders. Net book value grew by 4.6 percent in 2011, far less than the 13.0 percent increase in 2010, Berkshire Hathaway reported. Nevertheless, the increase was greater than the S&P 500 for the first time since 2008 by 2.5 points, the holding company reported.