Hedge Fund Manager To Take Over From Warren Buffett

Warren Buffett

Warren Buffett, chairman and chief executive officer of Berkshire Hathaway, has named his successor at the company. Charles Dharapak/AP hide caption

toggle caption Charles Dharapak/AP

Warren Buffett has named his successor as Chief Investment Officer at Berkshire Hathaway. Todd Combs, who runs a small hedge fund in Connecticut, will gradually take over the role. Buffett, 80, says he has no plans to step down anytime soon. But, he tells the Wall Street Journal, it's "a significant step. If I die tonight the board has something in place."

Combs, 39, runs his own hedge fund, Castle Point Capital, with about $400 million under mangement. He will eventually be taking over an investment portfolio worth some $100 billion dollars.

For now, Mr. Buffett says he will remain in his role as chief investment officer and that Mr. Combs will oversee a portfolio with a size he "feels comfortable with" and "scale up until he has a chance to get fully invested" over the next several months. Such a schedule would allow Mr. Combs to become invested without his returns and his pay—which will be tied to his performance versus that of the Standard & Poor's 500 stock index—being brought down by holding large amounts of cash.

For Mr. Combs, managing a much heftier portfolio than he's used to will make generating big gains harder because it will take sharper price moves to buoy a larger asset base.

Mr. Combs will join a company that has fewer than two dozen employees in its corporate office, but owns over 70 businesses that collectively had more than 257,000 employees at the end of 2009. The businesses run the gamut from Geico insurance and See's Candies to Dairy Queen and railroad operator Burlington Northern Santa Fe.

Buffett says he will split his current job into two, giving Combs the Chief Investment Officer title, eventually, and give the CEO job to someone else.



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