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Berkshire Hathaway Inc. Message Board

  • ignoramus_ ignoramus_ Aug 28, 1998 12:14 PM Flag

    Will the merger fail if BRK falls furthe

    I will repeat the question that I asked earlier.
    My questions were dismissed because people thought
    that Berkshire was not going down any further. Which
    it did promptly, and I was right.

    What are
    the chances of GRN shareholders NOT approving
    the
    deal if BRK continues tanking?

    I mean, at the
    current price, BRK is really way down and GRN
    shareholders seem to get a pretty raw deal, if you ask
    me.

    What is the likelihood that the merger will be blocked
    by GRN shareholder lawsuits?

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    • Let me say first that I hope it doesn't fall
      through because I am the proud owner of GRN stock
      (purchase price $239 3/4), unless, of course, that GRN
      should track back up if the merger is cancelled (by the
      way, I just voted FOR the merger on my GRN proxy). But
      I sure wouldn't buy GRN here; I'd rather have BRK,
      since the shares are almost trading at parity. Yes, GRN
      shareholders are getting a raw deal at these prices. I can't
      speak for others, but, as of now, I haven't filed suit
      to block the merger. ljh

      • 2 Replies to longjohnholder
      • when do they give us the news?

        it's always
        been my secret fear that web made TOO good a deal.
        that's the hitch to these negotiations. negotiate too
        well & you come up with a lost deal. if deal falls
        through, then we have a bigger share of our assets in this
        worldwide financial morass. & i fear gen re stockholders
        don't want to own this either. but either way, web will
        have some cash to hunt bargains.

      • <<< Let me say first that I hope it
        doesn't fall through because I am the proud owner of GRN
        stock (purchase price $239 3/4), unless, of course,
        that GRN should track back up if the merger is
        cancelled (by the way, I just voted FOR the merger on my
        GRN proxy). But I sure wouldn't buy GRN here; I'd
        rather have BRK, since the shares are almost trading at
        parity. Yes, GRN shareholders are getting a raw deal at
        these prices. I can't speak for others, but, as of now,
        I haven't filed suit to block the merger. ljh
        >>>

        Your irony is well taken...

        Well, perhaps the
        GRN-owning part of you would make more if you voted against
        the merger now. My impression is that GRN shares
        could fetch more if GRN was put up for auction. And
        they could buy BRK stock individually, although that
        would have different tax implications.

        I mean,
        sure, Buffett and Ron Ferguson got a good deal, but I
        do not think that GRN shareholders did. As a owner
        of BRK I am reasonably happy about this, but I am
        afraid that GRN owners may disagree.

        Good luck to
        all

    • Assuming that BRK is overvalued, GRN is fairly
      valued, and the merger does not go through... GRN will go
      up and BRK should go down. In which case I'd sell
      GRN and buy BRK and hopefully come out with more
      shares of BRK than if I sold & bought today.

    • <<WEB SUCKS ! >>

      Don't sweat
      it. There is EXTREME selling pressure on almost every
      stock. Only a few have weathered it better than the
      averages. Brk will follow the general market sentiment
      until people realize that they are better off letting
      Buffet manage their money.

      One other thing. Who
      says Buffet is not allowed to sell? We won't know if
      HE is driving down the price of Coke, Gillette, etc.
      Rumor has it he already bailed out of Travelors. I
      know, I know... he said he'll never sell his core
      holdings. But...?

    • Hi bobo, long time no speak. Hope all is well
      with all y'all.

      I don't watch the talking heads
      so I'm basing this on your post. My take on the
      Russian panic isn't so much that the rouble is collapsing
      (which it seems to be, and I hear that US$ seem to be
      the *real* currency there now) but that political
      stability is in question (so, what else is new?). I read a
      statistic (right or wrong) that the Russian GDP is around
      that of the Netherlands or so. Don't have the numbers
      to confirm that, but you get the point.

      Just
      what we need. If yeltsin goes and some Russian Mafia
      coalition controls the Duma & the presidency, who's got
      their finger on them nukes?

      China, however,
      might have a lot of interest and trade with Russia, I
      think. That might be a bigger fear; no one wants to see
      China devalue, because that might set off a whole new
      round of asian devaluations. It still might happen.
      That flood they got ain't pretty. Makes the missippi
      river floods from a few years back look like a wading
      pool.

      Domino effect, I guess, is the big fear. Maybe it's the
      (ex)communist revenge? Who knows.

      Money flows don't
      *have* to be rational. If they were, we couldn't be
      value players, now, could we?

      Cheers

      -
      infernal

    • WEB SUCKS !

    • .. by the time I noticed that the 'premium' had reversed,
      one did not have time to convert the GRN's into BRK's before the 'premium' returned.

      Good luck to all.

    • bobo sez:

      "By all accounts the weather in
      China is even worse than their censors will admit. I
      expect that disease and hunger will
      follow."

      Well, they're probably not the only spot in the hood
      where that's the case. I wonder what's happening in
      Indonesia right now for instance -- not necessarily
      weather-wise, but just plain pain & hunger.

      The number I
      heard on the radio was that 20% of China's population
      is affected directly by the flood. If that's true,
      then think: China's got around 20-25% of the world's
      population. So we're looking at a full 4-5% of the world's
      population being affected by this single flood!

      As to
      rice futures & such, I don't know anything about
      commodities. If it gets bad enough, there are also the
      international relief agencies (e.g., like in N. Korea). They do
      eat wheat in China, you know.

      What a freaking
      mess this planet is! Probably always was when we
      weren't paying attention.

      btw, the folks in s & n
      carolina probably aren't feeling too damned good either
      'bout now. Which brings us back to topic; how about
      BRK's reinsurance exposure to hurricane season? Looks
      like it might be a doozy this
      year.

      Cheers

      - infernal

    • ..........as always, an interesting post from
      you. By all accounts the weather in China is even
      worse than their censors will admit. I expect that
      disease and hunger will follow. We've got plenty of
      medicine and plenty of grain; so President Gore will be
      holding Aces wired in the hole when he eventually meets
      with the Chinese. Perhaps WEB is buying rice futures
      tonight. The beat goes on...........bobo

    • The merger calls for each GRN share to be
      converted into 0.0035 of a BRK.A share. GRN is now $207.5,
      and BRK.A is $60,500. 0.0035 of $60,500 is $211.75
      (higher than GRN at $207.5 right now). Therefore, it is
      to GRN shareholders' advantage to approve the deal
      (at current prices). GRN shareholders don't get a raw
      deal, BRK shareholders do.

    • <<<Assuming that BRK is overvalued, GRN
      is fairly valued, and the merger does not go
      through... GRN will go up and BRK should go down. In which
      case I'd sell GRN and buy BRK and hopefully come out
      with more shares of BRK than if I sold & bought today.
      >>>

      I see your point, but I have a problem with your
      statement. The two things:

      1) Buying GRN in hopes
      that you will end up owning BRK and the merger
      works
      and
      2) Hoping that the merger fails since you are afraid
      that BRK is overvalued

      Do not quite logically
      support each other. Am I missing something?

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