Buffett brings in potential successor, but timing is interesting

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Billionaire Warren Buffett’s, Berkshire Hathaway announced on Monday that it is bringing in a hedge fund manager named Todd Combs to the company. Most people, even those in the industry are not familiar with Combs, but it looks like he might be Warren Buffett’s successor. Buffett has said in the past that his role would likely be split in to a CEO position, as well as, a few investment chiefs. At this point it is unclear which, if any of those roles Combs will eventually be given.

This alone is somewhat big news because it gives the impression that Warren Buffett is putting in motion his retirement plans. A lot of people will be anxious for a while after Buffett retires because he has been a guide to many investors. Buffett is one of the best, if not the best investor in the last 40 or so years. He is among the richest people in the world so his succession will be a big deal when it eventually happens.

However, there is another interesting piece to this story. Berkshire Hathaway made the announcement of Todd Combs only hours before they announced a dispute with the SEC (Securities and Exchange Commission) over some accounting. Normally, this would be a day of bad publicity and news for a company because no one wants disputes with government regulators. Therefore, they decided to fill the news media with the hiring of Buffett’s potential successor, mostly to keep the bad news out of the spotlight.

This is a common but, very smart strategy and it looks like Berkshire Hathaway executed it well. Who knows, maybe Todd Combs is not even really being considered as a Buffett successor but in a few days the news will have done its job and we likely will have forgotten about the dispute with the SEC.