BNSF Announces $80 Million Capital Program in New Mexico for 2019

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BNSF Railway Company (BNSF) has announced that its 2019 capital expenditure program in New Mexico will be approximately $80 million. In addition to maintenance projects, the program includes additional quadruple main tracks to enhance capacity along the Southern Transcon route.

Maintenance projects to ensure BNSF continues to operate a safe and reliable rail network account for a majority of this year’s plan in New Mexico. Those projects consist of replacing and upgrading the main components for the tracks on which BNSF trains operate including rail, rail ties and ballast.

Nearly 4.5 million carloads of freight move along BNSF lines in New Mexico annually. The 2019 maintenance program in New Mexico includes more than 850 miles of track surfacing and/or undercutting work as well as the replacement of approximately 20 miles of rail and more than 200,000 ties. BNSF has invested approximately $555 million to expand and maintain its network in the state over the past five years.

On the Clovis Subdivision in Belen, BNSF will begin a project to extend its quadruple main tracks to enhance capacity along the Southern Transcon route.

“The Southern Transcon is the primary route for BNSF’s intermodal franchise. Building upon our investments totaling more than $1 billion in 2018 on the route, the extension of the quadruple track in Belen highlights our commitment to provide a safe, efficient and reliable network to our customers,” said Keary Walls, general manager of operations, Southwest Division.

The 2019 planned capital investments in the state are part of BNSF’s $3.57 billion network-wide capital expenditure program announced earlier this month. These investments include roughly $2.47 billion to replace and maintain core network and related assets, approximately $760 million on expansion and efficiency projects and about $340 million for freight cars and other equipment acquisitions.

© 2019 David Mazor

Disclosure: David Mazor is a freelance writer focusing on Berkshire Hathaway. The author is long in Berkshire Hathaway, and this article is not a recommendation on whether to buy or sell the stock. The information contained in this article should not be construed as personalized or individualized investment advice. Past performance is no guarantee of future results.

Lubrizol LifeSciences Announces New Medical Device Applications Lab

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Berkshire Hathaway’s Lubrizol Corporation has announced that its LifeSciences business will feature a new medical device applications lab.

LifeSciences has invested significantly to expand its global development and manufacturing facilities, and the latest investment is a new state-of-the-art medical device applications lab in Brecksville, Ohio.

The lab features applications testing, small-scale compounding as well as injection molding for long-term implantables. The 1,800-square foot facility will also focus on accelerated R&D, from polymers to device scale up and testing in a short period of time.

“The new applications lab is another commitment to healthcare companies looking for a full-service development partner. We continue to invest in the right areas to provide valuable offerings where our customers are experiencing the most growth,” states Uwe Winzen, general manager, Lubrizol LifeSciences. “When customers partner with Lubrizol LifeSciences, they benefit from working with us at every stage in their development process.”

Offering more than 90 years of science and technology experience, Lubrizol is uniquely structured to partner with medical device manufacturers by providing proactive innovation, speed to market, and expertise for the most demanding projects. From materials to development and manufacturing, or anything in between – Lubrizol LifeSciences is equipped to support the needs of customers worldwide.

© 2019 David Mazor

Disclosure: David Mazor is a freelance writer focusing on Berkshire Hathaway. The author is long in Berkshire Hathaway, and this article is not a recommendation on whether to buy or sell the stock. The information contained in this article should not be construed as personalized or individualized investment advice. Past performance is no guarantee of future results.

McLane Opens New Grocery Distribution Center in Ocala, Florida

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Berkshire Hathaway’s McLane Company, Inc., a leading supply chain services company providing grocery and foodservice supply chain solutions, formally announced it has opened a new grocery distribution center, McLane Ocala, in the Ocala International Commerce Center at 910 NW 50th Avenue in Ocala, Florida.

The 400,000 square foot facility will house 165,000 square feet of dry grocery, nearly 200,000 square feet of perishables and 35,000 square feet of office and support space. The first shipment arrived on February 4, 2019 and deliveries will begin on March 17, 2019.

The new distribution center will create over 400 new jobs in Marion County. By the end of the year, McLane Ocala plans to onboard 316 warehouse and support teammates and 120 drivers and transportation support teammates. Driver hiring began in October of 2018 in effort to allow drivers to become acclimated with McLane’s customers and the delivery process in general. The recruiting team held a three-day job fair in January at the facility and nearly 600 candidates were interviewed, resulting in 233 job offers.

This location will be McLane’s sixth distribution center in Florida, joining the grocery center in Kissimmee and four foodservice centers in Lakeland, Haines City and two in Orlando and will service the quickly-expanding customer base in the North Florida region. Construction Management Technology (CMT), the general contractor for the project, oversaw the renovations and development. The Ocala/Marion County Chamber and Economic Partnership (CEP), The County Commission and Ocala City Council were instrumental to the venture as well.

“We are thankful for McLane Company’s presence here in our community,” said Ocala Mayor Kent Guinn. “We are excited about their growth, their services and their community involvement.”

Michelle Chesnutt and Jerry Winterhalter are leading the operation with a combined 70 years of experience at McLane. Both teammates have held numerous positions within the company. Chesnutt recently transitioned from division president at McLane Dothan in Cottonwood, Alabama, while Winterhalter was vice president of distribution at McLane Sunwest in Goodyear, Arizona.

“We are thrilled to open our new facility in Ocala where the business community is welcoming and open to growth,” said Michelle Chesnutt, division president of McLane Ocala. “The values and work ethic of the prospective workforce is an ideal fit with McLane’s culture. McLane Ocala continues our company’s core initiative to drive customer results.”

© 2019 David Mazor

Disclosure: David Mazor is a freelance writer focusing on Berkshire Hathaway. The author is long in Berkshire Hathaway, and this article is not a recommendation on whether to buy or sell the stock. The information contained in this article should not be construed as personalized or individualized investment advice. Past performance is no guarantee of future results.

Commentary: Berkshire Hathaway Takes the Easy Money in IBM-Red Hat Merger

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In life there’s hard money and there’s easy money. There are times when you work day and night and have little to show for it, and there are times when the money falls like leaves from a tree.

One thing about Berkshire Hathaway, they’re never afraid to make money the easy way.

And what could be easier than with a click of a mouse buying up shares that somebody’s already committed to paying more for?!

With IBM set to buy Red Hat Software for $34 billion, Berkshire Hathaway has been busy buying up shares for what looks to be a profitable merger arbitrage play.

IBM’s move is the third-biggest U.S. technology merger history, trailing only Dell’s acquisition of EMC, and the JDS Uniphase acquisition of SDL, and Berkshire has jumped in and scarfed up 4,175,792 shares of Red Hat at an average price of $175.64 per share, it just revealed in its latest 13F filing for Q4 2018.

The shares represent 2.3730% of the software and cloud computing company, and if the deal goes through, Berkshire will make a profit of 7.55% for just buying and holding until the closing date.

The deal is expected to close in late 2019.

Berkshire does not disclose who makes a particular stock purchase or sale, so it’s not known whether the move is the handiwork of Warren Buffett, or his portfolio managers Todd Combs and Ted Weschler.

Combs and Weschler each handle separate portfolios of roughly $10 billion each, which combined is just over 10% of Berkshire’s diverse $183 billion portfolio of shares in companies such as Apple, Coca Cola, Bank of America, Wells Fargo, American Express, JP Morgan Chase, Delta, Goldman Sachs, and Southwest Airlines, among others.

IBM hopes its acquisition of Red Hat will provide an open approach to cloud computing, and make IBM the #1 hybrid cloud provider in an emerging $1 trillion growth market. It plans for Red Hat to operate as a distinct unit within IBM’s Hybrid Cloud team.

We Don’t Care. We Don’t Have To

However Red Hat operates, it won’t matter to Berkshire.

Berkshire previously dumped all its IBM shares when it lost hope in IBM’s growth plans after company racked up almost six years of declining sales.

Unlike IBM, Red Hat has seen dramatic revenue growth. Its revenue shot up 21% between the 2017 and 2018 fiscal years.

However, IBM’s offer to pay $190 a share for Red Hat has Berkshire excited if not for IBM, than at least for the billions it will pay for Red Hat.

IBM is swinging for the fences with its largest acquisition in its history. And Berkshire is more than happy to hit a nice clean single of its own.

© 2019 David Mazor

Disclosure: David Mazor is a freelance writer focusing on Berkshire Hathaway. The author is long in Berkshire Hathaway, and this article is not a recommendation on whether to buy or sell the stock. The information contained in this article should not be construed as personalized or individualized investment advice. Past performance is no guarantee of future results.

Forest River Leads RV Pack in Recreational Vehicle Global Growth

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Berkshire Hathaway’s recreational vehicle maker Forest River is riding a wave of strong global growth for the RV market.

The global recreational vehicles market, which was worth $54.63 billion in 2017 is projected to grow at a CAGR of about 4.11% from 2017 to 2025 to $75.38 Billion by 2025.

According to the report, “Recreational Vehicles (RVs) Market Size and Forecast By Product (Towable and Motorhomes), By Application (Commercial and Residential) And Trend Analysis, 2015 – 2025”, in 2016, 40 million Americans participated in camping activities, which is a primary booster for the growth of global recreational vehicle industry.

Berkshire’s Forest River Inc., is the largest player with a more than 25% share, followed by Thor Industries Inc., Winnebago Industries Inc., and REV Recreation Group.

According to the report, the U.S. market has roughly 10 million of the consumers aged between 35 years to 75 years that own recreational vehicles.

The China market is seeing increasing development of tourism and campgrounds coupled with consumers’ changing travel preferences is spurring the traction of recreational vehicles market. However, according to the report the domestic recreational vehicle market in China is still in the nascent stage, wherein consumers purchased about 25,000 vehicles in 2016. The purchase number is expected is to reach 500,000 by 2020 supported by growing economy and rising middle class.

© 2019 David Mazor

Disclosure: David Mazor is a freelance writer focusing on Berkshire Hathaway. The author is long in Berkshire Hathaway, and this article is not a recommendation on whether to buy or sell the stock. The information contained in this article should not be construed as personalized or individualized investment advice. Past performance is no guarantee of future results.

Johns Manville Announces New Water-Repellent Pipe Insulation

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Johns Manville, a leading global manufacturer of energy-efficient building products and engineered specialty materials and a Berkshire Hathaway company, announced today that it will release water-repellent, mandrel-wound, mineral wool industrial pipe insulation, MinWool-1200® Pipe, in February of 2019.

According to Jeff Semkowski, Industrial Portfolio Manager for Johns Manville, JM created this new product in response to growing demand for water-repellent materials in the industrial insulation market.

“The market is showing a decided preference for water resistance in insulation materials that are being specified, as an added defense mechanism to combat corrosion under insulation (CUI),” said Semkowski. He explained that the voice of the customer and the engineering community are crucial in helping JM ensure that they are delivering innovative, effective insulation materials for their customers.

“After releasing Thermo-1200™, the first water-resistant calcium silicate on the market, our customers indicated that they wanted a water-repellent mineral wool, so we responded to their needs with MinWool-1200 Pipe.”

MinWool-1200 Pipe insulation was designed to help mitigate the risk of water intrusion. It was tested in accordance with BS EN 13472, absorbing less than 1 kg/m2 of water during the absorption tests. BS EN 13472 is a British Standard test method that measures weight gain by partial immersion in water and in recent years, it has become increasingly more common in material specifications.

Jack Bittner, Senior Industrial Product Manager for Johns Manville, explained that MinWool-1200 Pipe insulation will continue to offer the same thermal performance and lightweight benefits as it always has, but now it will be water-repellent.

“MinWool-1200 Pipe insulation remains unchanged in its performance characteristics. It can still be used in applications with operating temperatures up to 1200°F, and it is still lightweight; the only difference is that MinWool-1200 Pipe now inhibits water intrusion,” he said.

MinWool-1200 Pipe will be available from Johns Manville’s Phenix City, AL facility beginning in February 2019.

© 2019 David Mazor

Disclosure: David Mazor is a freelance writer focusing on Berkshire Hathaway. The author is long in Berkshire Hathaway, and this article is not a recommendation on whether to buy or sell the stock. The information contained in this article should not be construed as personalized or individualized investment advice. Past performance is no guarantee of future results.

Berkshire Hathaway’s Insurance Group Launching THREE Insurance Product

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Berkshire Hathaway’s Insurance Group announces the launch of THREE, its three-page, game-changing, comprehensive insurance product for small business. Businesses typically need several types of insurance to protect their interests, but until now they could only get that protection by buying multiple, unconnected and overly complex policies–each of which can be over fifty pages in length.

In three straightforward, plain English pages, THREE provides insurance coverage for workers compensation, multiple liability coverages (including general liability, errors and omissions, and cyber), property and auto – all the insurance most any small business could need. Replacing the usual chores of time-consuming, multiple applications and coordination,

THREE delivers one fully comprehensive (and comprehensible) small business policy, in a fast, easy one-stop shopping experience. Efficiency is increased further by providing THREE direct to small businesses, without the need to go through a broker or third party.

Minimizing the risk of not knowing what is being covered, and which policy might apply, makes THREE the right policy for risk averse risk takers.

Berkshire Hathaway Chairman Warren Buffett said, “Insurance is important protection for any business, but few small businesses have the time to actually read through the policy forms that are supposed to protect them. With THREE a small business can be confident in the protection it is getting, because the whole policy can be read in a few moments. Every day, America’s small businesses prove that great things come in small packages. Now they can get insurance on the same basis.”

THREE will be rolled out across the country as quickly as state regulatory filings and approvals can be obtained, but all are now welcome to preview THREE at “threeinsure.com”.

© 2019 David Mazor

Disclosure: David Mazor is a freelance writer focusing on Berkshire Hathaway. The author is long in Berkshire Hathaway, and this article is not a recommendation on whether to buy or sell the stock. The information contained in this article should not be construed as personalized or individualized investment advice. Past performance is no guarantee of future results.

Kraft Heinz Looks to Expand India Sales With New Indo Nissin Foods Partnership

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Just weeks since selling its Indian brands – Complan, Glucon-D, Nycil, and Sampriti – to Zydus Wellness, Kraft Heinz has entered a distribution partnership with Japanese food giant Indo Nissin Foods.

The company is best known as the manufacturer of Cup Noodles and Top Ramen instant noodles.

The partnership will include multiple channels such as retail, modern trade, government channels and e-commerce distribution avenues, ensuring consumers have seamless access to Heinz Tomato Ketchup, said Heinz.

The partnership will also aim to open up new markets and introduce additional Kraft Heinz products into the Indian market.

Sankalp Potbhare, MD of Kraft Heinz India, said: “We are looking to aggressively grow in India with the support of Indo Nissin Foods’ distribution channels.”

© 2019 David Mazor

Disclosure: David Mazor is a freelance writer focusing on Berkshire Hathaway. The author is long in Berkshire Hathaway, and this article is not a recommendation on whether to buy or sell the stock. The information contained in this article should not be construed as personalized or individualized investment advice. Past performance is no guarantee of future results.

Business Wire Announces Expansion Of Its Paris Office

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Berkshire Hathaway’s Business Wire, the global leader in press release distribution and regulatory disclosure, has announced that its Paris office has moved and is expanding.

Business Wire France was launched in October 2005 and is now relocating Place de la Madeleine in Paris with the ambition to add new staff and increase its market share in France and Southern Europe.

For Patrice le Tulle, Business Wire Regional Director France & Southern Europe, “moving in this new space in the heart of Paris gets us closer to our historical clients and for our clients abroad, the address reflects our international dimension. Besides, we will be able to organize workshops and seminars around PR, IR and other topics linked to our industry because we now have the capacity to host these types of events”.

Business Wire Paris office has its own newsroom with a team of professional editors. With 19 newsrooms and over 200 editors worldwide, Business Wire is the only newswire service to offer such a proximity relationship with its clients. Building local presence is key to Business Wire to better understand the communications needs of companies and industries in their local markets.

French companies will continue to benefit from the large distribution networks Business Wire provides as well as local assistance, two fundamentals of Business Wire to better serve its clients. From press releases distribution with photos and videos, disclosure, online newsrooms, interactive media, content marketing platforms to analytics and social media monitoring, Business Wire has a wide range of services to suits all communications needs.

“We are extremely proud to see our Paris office expands”, explains Geff Scott, Business Wire’s CEO. “After ten years of growth, this office has the ambition to further develop the Business Wire group’s clients base in Italy, Spain and Portugal, countries where the newswire culture is still not widespread. For PR and IR professionals, this announcement is a sign of the vitality of Business Wire and its industry.”

© 2019 David Mazor

Disclosure: David Mazor is a freelance writer focusing on Berkshire Hathaway. The author is long in Berkshire Hathaway, and this article is not a recommendation on whether to buy or sell the stock. The information contained in this article should not be construed as personalized or individualized investment advice. Past performance is no guarantee of future results.

GEICO Adding Employees in Buffalo

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The GEICO regional office in Buffalo, New York, is hiring.

Even in a tight labor market, GEICO’s Buffalo office has grown from 500 to more than 3,000 associates since first opening its doors in 2004. This immense growth led to the opening of a second building in 2017. To better serve GEICO’s growing customer base in New England, GEICO is seeking to add an estimated 200 more associates this year.

“The tremendous pool of talent in Western New York has helped this office prosper over the years,” Regional Vice President Jeremy Connor said. “We are excited to extend an invitation to others to join our GEICO family and help us continue to offer the top-notch customer experience that GEICO is known for.”

© 2019 David Mazor

Disclosure: David Mazor is a freelance writer focusing on Berkshire Hathaway. The author is long in Berkshire Hathaway, and this article is not a recommendation on whether to buy or sell the stock. The information contained in this article should not be construed as personalized or individualized investment advice. Past performance is no guarantee of future results.