Mazor'sEdge – Page 176 – News and analysis on Berkshire Hathaway

NV Energy Adding to its Renewable Energy Generation Capacity

Post author By David Mazor
Post date November 10, 2017

(BRK.A), (BRK.B)

Berkshire Hathaway’s NV Energy is continuing to add to its renewable energy generation portfolio. The Nevada-based utility has signed three new long-term power purchase agreements that total100 megawatts. The requests are awaiting approval by the Public Utilities Commission of Nevada.

NV Energy’s President and Chief Executive Officer Paul Caudill noted that the projects include the largest solar array in Northern Nevada at a nameplate rating of 50 megawatts.

“These new projects signal an important step toward NV Energy’s commitment to partner with our customers in order to serve them with 100% renewable energy. Equally important to the low-cost solar energy being added to our customers’ portfolio, these projects benefit Nevada’s working families and provide another opportunity for our construction trade partners to gain skills in the renewable industry,” Caudill said. “We are pleased that all three projects include work site agreements with the International Brotherhood of Electrical Workers.”

It is estimated that up to 250 construction workers and nine permanent positions would be needed for the three projects.

The largest of the three new projects is the 50-megawatt Turquoise Nevada solar project, to be constructed in the Reno Technology Park in Washoe County, Nevada. The project will benefit from a 25-year power purchase agreement with NV Energy and is expected to be operational by the end of 2020.

The Turquoise Nevada solar project is a venture of Estuary Capital Advisors and Sumitomo Corporation of Americas. Sumitomo is an integrated global trading and investment enterprise with ownership in renewable energy facilities totaling 5,000 megawatts worldwide.

NV Energy has submitted a separate request with the Public Utilities Commission of Nevada to utilize the NV GreenEnergy Rider program to help a major customer offset 100 percent of its next phase of growth with solar energy.

“We are excited to help bring the largest solar energy field in Northern Nevada to a reality, and we appreciate the dedication many large Nevada customers have to using the NV GreenEnergy Rider program to offset their energy usage using renewable resources,” stated Pat Egan, NV Energy senior vice-president, renewable energy and smart infrastructure.

The other two new proposed 25-year power purchase agreements are the result of a Request For Proposals that was issued by NV Energy June 14, 2017. The 25-megawatt Techren Solar 3 project will benefit NV Energy customers in Southern Nevada and the 25-megawatt Techren Solar 4 project will benefit customers in Northern Nevada. If approved, the new solar energy projects will be operational on or before September 1, 2020.

The new solar resources will be owned by Techren Solar, LLC and will be located adjacent to the 300-megawatt Techren Solar 1 and 2 projects that are in development in Boulder City’s Eldorado Valley.

“To the best of our knowledge, Techren 3 and 4 are the lowest-cost universal solar power purchase agreements entered into in the United States,” Egan said.

Today NV Energy customers are served by 19 geothermal energy plants, 16 universal-scale solar fields, six hydro projects, five biomass or methane projects and one wind farm. In total, these projects represent more than 1,600 megawatts of nameplate renewable energy capacity. If all were operating at the same time they would generate enough energy to serve nearly a million typical homes in Nevada.

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.

Tags Berkshire Hathaway Energy

Retail

Ben Bridge Jeweler Appoints New President

Post author By David Mazor
Post date November 9, 2017

(BRK.A), (BRK.B)

Berkshire Hathaway’s Ben Bridge Jeweler, a family-run fine jeweler with over 90 retail stores in 11 states and one province, has announced that Co-CEO and General Counsel Jonathan (Jon) Bridge is retiring, and current President and Co-CEO, Edward (Ed) Bridge will become Chairman and CEO.

Lisa Bridge C.G., the company’s Vice President of Education and the creator of the Lisa Bridge Collection, has been appointed as the company’s President and Chief Operating Officer.

Lisa will be the company’s first female President and its youngest top executive in over 60 years. “I love the relationships that are built over a beautiful piece of fine jewelry and I am eager to provide amazing experiences for each of our customers.”

“Ben Bridge has been a part of Berkshire Hathaway for 17 years and Lisa represents a wonderful balance of continuity and evolution,” says Chairman of Berkshire Hathaway Warren Buffett. “With the challenges facing retailing, I am excited to have someone passionate for the jewelry business, with creative ideas, and an understanding of today’s consumer at the helm. Lisa has retailing in her blood and I am excited for the future with Lisa as President.”

“I am pleased and excited about passing the torch of leadership to the next generation of our family,” says Jon Bridge. “Lisa has been a critical part of Ben Bridge for years and will continue the tradition of service to our customers and communities that we have built over the last century while evolving the business to grow in the digital age. Her knowledge of the business and insight as a member of the next generation will greatly expand opportunities for our company.”

Lisa Bridge, a fifth generation jeweler, is a Certified Gemologist and jewelry designer who launched her own namesake collection in 2015, a compilation of bold and fashionable jewelry inspired by the natural beauty she has encountered in her many travels. Lisa also spent the last seven years as Vice President of Education, overseeing the education and professional development of the company’s 1,200 associates. As President, Lisa will oversee merchandising, operations, marketing, sales, and human resources as she continues to evolve the business.

Tags Ben Bridge

Dairy Queen

Dairy Queen Opens First Restaurant in South Korea

Post author By David Mazor
Post date November 8, 2017

(BRK.A), (BRK.B)

Berkshire Hathaway’s International Dairy Queen, Inc. has launched itse first DQ Grill & Chill location in South Korea.

Located in the Daehak-ro area of Seoul, it is the first of 50 locations that are planned in South Korea within the next five years.

Additional DQ Grill & Chill locations will soon open in Itaewon, Gangnam and Hongdae.

The DQ Grill & Chill locations in South Korea will serve fan-favorite DQ treats and food, including the world-famous Blizzard Treats, which are served upside down, soft-serve cones with the signature curl on top, sundaes and DQ Cakes as well as a full range of food options such as GrillBurgers, chicken strip baskets, chicken sandwiches and a variety of salads.

In addition, new and exciting menu items available in South Korea will include Asia-inspired Blizzard Treats, such as a Green Tea Red Bean Blizzard Treat, and Asia-inspired smoothies. The new restaurants also will launch a beverage platform complete with soft drinks, Ades, smoothies, coffees and teas.

“We continue to expand the DQ brand in Asia,” says John Gainor, President and CEO of International Dairy Queen, Inc. (IDQ). “We have partnered with a franchisee that is a veteran of the food business and has an experienced team already in place. We look forward to introducing DQ Grill & Chill restaurants to our fans in South Korea.”

IDQ’s subsidiary, American Dairy Queen Corporation (ADQ), signed a multi-unit development agreement to develop restaurants in South Korea with the privately held M2G USA Investment, Inc., which has a diversified business portfolio that includes ownership of restaurants, hotels, public storage businesses, household appliance manufacturing, shoes and an extensive global real estate portfolio.

The DQ system has more than 6,800 locations with more than 2,300 of those units operating outside of the United States.

For more information on Dairy Queen’s world-wide plans, read a Mazor’sEdge special report on Dairy Queen.

Tags Dairy Queen

Berkshire Hathaway Specialty Insurance Insurance

Berkshire Hathaway Specialty Insurance Expands Coverage for Large Contractors

Post author By David Mazor
Post date November 7, 2017

(BRK.A), (BRK.B)

Berkshire Hathaway Specialty Insurance has unveiled the Excess Integrated Follow Form, a single excess policy that sits atop multiple first- and third-party insurance policies, for contractors in the U.S. and Canada.

“With multi-line excess coverage from BHSI, contractors gain consistency in limits and tower attachment points and can reduce gaps in coverage. They also benefit from streamlined claims services when they have a loss and reduced frictional claims expenses,” said Bill Sullivan, North American Head of Casualty Construction, BHSI.

The new BHSI policy provides excess follow form protection above multiple underlying coverages, including general liability, environmental liability, employer’s liability, and professional liability. The excess coverage comes with a single limit, backed by BHSI’s financial strength. The Excess Integrated Follow Form is designed for larger contractors with complex exposures.

Tags Berkshire Hathaway Specialty Insurance, Insurance

Dairy Queen

Major Texas Dairy Queen Franchisee Goes Bankrupt

Post author By David Mazor
Post date November 6, 2017

(BRK.A), (BRK.B)

The U.S’s second largest franchise operator of Dairy Queen restaurants, Vasari, has filed for bankruptcy protection. The company blames the decline in the west Texas oil businesses for hurting its revenues.

Owned by Vickie L. Driver of Husch Blackwell, and William M. Spae Jr., Vasari operates 70 DQ locations across Texas, Oklahoma and New Mexico.

Vasari has filed for Chapter 11 protection with the U.S. Bankruptcy Court in the Northern District of Texas, Fort Worth Division. In its filing it noted:

“The difficulties faced by the Debtor can largely be traced to the much publicized decline in oil prices. The decline in oil prices has severely impacted the job market for oil related jobs in regions of west Texas and east Oklahoma and has thus resulted in cross-industry declines in revenues in areas heavily dependent on oil related jobs. Many of the Debtor’s DQ locations sit in ‘Oil Country’ and have been severely impacted by the decline in oil prices due in large part to the loss of oil-related jobs and the resulting mass exodus of residents from areas in which the DQ locations sit. Since bouncing from a 12 year low, oil prices have begun to rebound; however, oil-related jobs have not. Without oil-related jobs, certain DQ locations will likely continue to underperform, causing a drain on the Debtor’s resources.”

Texas is a stronghold for the Dairy Queen brand. The chain is particularly popular in southern states, with 600+ stores in Texas alone, and Texas has its own marketing association, the Texas Dairy Queen Operators Council.

In conjunction with the announcement of the bankruptcy, Vasari immediately closed 18 Dairy Queen restaurants in Texas and four in New Mexico and Oklahoma.

For more information on Dairy Queen’s world-wide plans, read a Mazor’sEdge special report on Dairy Queen.

Tags Dairy Queen

CTB

CTB to have Strong Growth in Poultry Processing

Post author By David Mazor
Post date November 3, 2017

(BRK.A), (BRK.B)

Berkshire Hathaway’s CTB, Inc. is projected to have strong growth in its sales of poultry processing equipment.

According to a report published on marketsandmarkets.com, the poultry processing equipment market is projected to reach USD 3.83 Billion by 2020, at a CAGR of 4.7% from 2015 to 2020.

The report “Poultry Processing Equipment Market by Type (Chicken, Turkey, Ducks), Equipment Type (Killing & Defeathering, Evisceration, Cut-ups, Deboning & Skinning, Marinating & Tumbling), Product Type, & by Region – Global Forecast to 2020,” notes that “increased consumption of processed food, the government support for the use of equipment in developing countries, the demand for food safety, safety of workers, environment and sustainability, the presence of small and medium enterprises in developing countries, rising raw material costs, and international trade rules are the major drivers for the poultry processing equipment market.”

In 2016, CTB acquired the majority share in Danish company Cabinplant A/S. The acquisition added additional poultry processing equipment to CTB’s existing line of Meyn processing equipment for poultry, as well as processing solutions for fish and shellfish, fruit and vegetables, and convenience foods.

“Market requirements are constantly increasing,” states Erik Blom, Managing Director of Meyn Food Processing Technology, “and we will keep investing in intelligent solutions according to different international standards.” With three production sites in Oostzaan/The Netherlands, Poland and the United States as well as offices all over the world, Meyn is in close cooperation and communication with their clients in over 100 countries and prepared to answer the challenges of the future.

Tags CTB Inc.

Acquisitions Berkshire Hathaway Energy

MidAmerican Energy Buys Wind Farm from Tradewind Energy

Post author By David Mazor
Post date November 2, 2017

(BRK.A), (BRK.B)

Berkshire Hathaway continues to add to its renewable energy portfolio. Berkshire’s MidAmerican Energy Co., a subsidiary of Berkshire Hathaway Energy, has purchased the North English Wind Project, which is currently under construction in Iowa.

When completed, North English will generate 340 megawatts of wind energy.

The North English Wind Project is located approximately 60 miles east of Des Moines, Iowa in the high-yielding corn and soybean farmlands of Poweshiek County, Iowa. The wind farm is expected to interconnect to a 345 kV (MIDAM) line located in Poweshiek County.

“We are thrilled to support Iowa’s continued leadership in wind energy through the development of the North English Wind Project,” Jeff Hammond, senior development manager for Tradewind, said in a statement. “MidAmerican Energy Co. has a vision to provide 100 percent renewable energy for its customers, and it’s exciting to partner with them toward achieving that goal.”

According to Tradewind, more than 200 landowners and over 30,000 acres will be involved in the project.

Tags Berkshire Hathaway Energy

Forest River

Forest River Marine Joins the Marine Retailers Association of the Americas

Post author By David Mazor
Post date November 1, 2017

(BRK.A), (BRK.B)

Berkshire Hathaway’s Forest River Marine, a division of Forest River, Inc., has become a platinum member of the Marine Retailers Association of the Americas.

The MRAA’s mission is to be the single voice of marine retailers, providing member services that include: fostering and uniting relationships; raising awareness and professionalism; protecting common interests and strengthening all members.

The association is comprised of boat dealers, marine parts and accessories vendors, marina operators, boatyards, marine service providers, and all those whose livelihood is affected by the marine industry.

“We believe in the importance of a strong and effective dealer body,” said Tom McCuddy, Forest River Marine general manager. “We are proud to have a strong network of dealers, and we believe that supporting the work of our industry’s dealer association is an important contributor to the overall health of our industry and our boating community.”

Forest River Marine is a leading manufacturer of pontoon boats under the Berkshire, South Bay, and Trifecta brands.

“The Forest River team has shown a great desire to strengthen its dealer network in support of their customers,” said MRAA President Matt Gruhn. “From their participation at our annual conference all the way through to their communications with the Forest River dealer network about programs and opportunities that our team here at MRAA has to offer them, they continue to invest in and lead the way with dealer development.”

Tags Forest River

Acquisitions Commentary Minority Stock Positions Stock Portfolio

Commentary: Akzo Nobel and Axalta Coatings Merger Would Benefit Berkshire Hathaway

Post author By David Mazor
Post date October 31, 2017

(BRK.A), (BRK.B)

A possible merger between Akzo Nobel NV and Axalta Coating Systems would give Berkshire Hathaway a major stake in a world-leader in the coatings market.

The Dutch coatings company Akzo Nobel is reportedly in the discussion stage with Philadelphia-based Axalta on a deal that could create a $30 billion coatings behemoth. The discussions have been described as a “merger of equals’ even though Axalta is the smaller of the two companies.

One of the benefits for Akzo Nobel would be to make it too large for takeover by other coasting companies, including PPG Industries.

The potential merger has already benefited Berkshire, as shares in Axalta soared 17% to Friday’s closing price of $33.15 on news of the discussions.

Berkshire currently owns 23,324,000 shares of Axalta, which is approximately 9.59% of the company, and has a value of roughly $745,668,263. 20 million of its stake was purchased in April of 2015 from The Carlyle Group for an aggregate purchase price of $560 million, or $28.00 per share.

Axalta was founded in 1866 as Herberts, the original producer of Standox paint products. Spun off of DuPont Performance Coatings in 2013, it was sold to The Carlyle Group and renamed Axalta Coating Systems. Today the company is a leader in coatings for commercial vehicles.

When Berkshire took its stake in Axalta back in 2015, the company looked like a possible merger candidate with Berkshire’s Lubrizol. However, Berkshire’s never been shy about owning significant minority stakes in companies if they are purchased at favorable prices.

Such is the case with Axalta.

Tags Stock Portfolio

Acquisitions Berkshire Hathaway Energy Commentary

Commentary: Could the Door Open Again for a Berkshire Acquisition of Oncor?

Post author By David Mazor
Post date October 29, 2017

(BRK.A), (BRK.B)

Berkshire Hathaway’s ongoing interest in acquiring Oncor Electric Delivery might still have a chance, if only a faint one.

Sempra Energy, which this August outbid Berkshire for Oncor, is running into some of the same resistance that torpedoed the last two attempts to acquire what is the largest distribution and transmission system in Texas.

Sempra’s $9.45 billion bid won out after Berkshire refused to get into a bidding war and stood firm on its $9 billion all-cash consideration that implied an equity value of approximately $11.25 billion for 100% of Oncor.

Now, San Diego-based Sempra has to gain the approval of the Public Utility Commission of Texas, and Commissioner Ken Anderson is raising concerns on the amount of money Sempra will have to raise in order to finance the deal and the credit rating of the company.

The PUC has to rule on whether the Sepra deal is in the public’s interest, and on October 5, Moody’s Investors Service issued a comment titled “Sempra Energy: Revised structure for EFH/Oncor acquisition reduces complexity but transaction remains credit negative.”

Credit negative is not the case with Berkshire. Certainly, financing a deal is not a problem for Berkshire, as it is sitting on over $100 billion in cash that it has been hard-pressed to invest as of late.

Commissioner Anderson’s concern is a valid one, as Oncor has been mired in the decade long financial morass that found its parent company Energy Future Holdings Corp. in bankruptcy after being loaded with $40 billion in debt from a leveraged buy-out engineered by private equity firms KKR & Co. and TPG.

While it’s a longshot that Berkshire can get another shot at Oncor, perhaps a very long shot, the one thing Texas ratepayers need at this point is financial stability.

Tags Berkshire Hathaway Energy