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You Won't Believe What Warren Buffett Is Doing Now

A quick glance at some of the firms owned by Berkshire Hathaway reveals some of the most recognizable names in the country, though these companies rarely boast of falling under the Berkshire Hathaway umbrella:

A Sampling of Berkshire Hathaway Companies
Benjamin Moore GEICO
Duracell* NetJets
Fruit of the Loom See's Candies
Heinz The Pampered Chef
Helzberg Diamonds Vanity Fair Brands

*Acquired on Nov. 13, 2014. Source: Berkshire Hathaway Annual Report.

But all signs indicate this lack of awareness about the true owner of these companies may soon be changing: In recent years, Buffett and Berkshire have begun rebranding some of the most recognizable businesses to reflect their ownership.

Source: Berkshire Hathaway HomeServices.

For example, following Berkshire's acquisition of 67% of the Prudential and Real Living real estate franchise operations, Buffett noted in his 2012 letter to shareholders, "In the coming years, we will gradually rebrand both our franchisees and the franchise firms we own as Berkshire Hathaway HomeServices."

And in last year's letter to Berkshire shareholders, Buffett said, "If you haven't yet, many of you will soon be seeing our name on 'for sale' signs."

But it doesn't stop with HomeServices. In April we learned that MidAmerican Energy -- which is owned by Berkshire and has 8.4 million customers and $70 billion in assets -- had changed its name to Berkshire Hathaway Energy.

"Our new name reflects the benefits we gain from Berkshire Hathaway's ownership, particularly our ability to reinvest in our businesses and take a long-term view of our customers' needs, which have helped us become a leader in the global energy industry," said Greg Abel, the chairman, president, and CEO of Berkshire Hathaway Energy.

Berkshire also recently acquired Van Tuyl Group, "the nation's largest privately owned auto dealership group." When the move was announced, we also learned the Van Tuyl Group would subsequently be renamed to Berkshire Hathaway Automotive.

And note the subtle difference in the final frame of Helzberg Diamonds' Christmas season commercials from 2013 to 2014:

Although the addition of "A Berkshire Hathaway Company" is hardly noticeable, it should attract the attention of investors everywhere.

Source: Helzberg Diamonds YouTube channel .

The reason

One of the common themes among all the businesses being rebranded is that they operate in areas where many Americans make their largest single purchases -- a home, a car, a wedding ring, etc.

This is why, when discussing the decision to rebrand HomeServices, Buffett said:

When people are making the decision of the magnitude of buying a house, it's the biggest decision a great many families will ever make. They want to know who they're working with and we think that Berkshire Hathaway name will be reassuring to many of those people.

And although your utility bills don't represent a big singular purchase, Berkshire Hathaway Energy generates 60% of its revenue from states that are either fully or partially deregulated, meaning customers can choose which company supplies their electricity or gas.

And if you bought your wedding ring, car, and home from a Berkshire Hathaway company, wouldn't you be more willing to get your electricity from Berkshire, too?

The key takeaway

Buffett's love for brands -- particularly See's Candies and Coca-Cola -- has been well-chronicled through the years. When discussing the retirement of longtime See's manager Chuck Huggins in 2005, Buffett said:

Chuck's love for the customer and the brand permeated the organization, which in his 34-year tenure produced a more-than-tenfold increase in profits. This gain was achieved in an industry growing at best slowly and perhaps not at all.

Although we are nearly a decade removed from those remarks, Buffett still clearly appreciates the value of a company that treats its customers well, so it's only sensible that Berkshire is aiming to make Americans more aware of who actually owns all these companies.

And the conglomerate's investors should also enjoy the benefits of a more public-facing Berkshire.

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The article You Won't Believe What Warren Buffett Is Doing Now originally appeared on Fool.com.

Patrick Morris owns shares of Apple, Berkshire Hathaway, Coca-Cola, and Google (C shares). The Motley Fool recommends American Express, Apple, Berkshire Hathaway, Coca-Cola, Google (A shares), Google (C shares), and Wells Fargo. The Motley Fool owns shares of Apple, Berkshire Hathaway, Google (A shares), Google (C shares), International Business Machines, and Wells Fargo and has the following options: long January 2016 $37 calls on Coca-Cola and short January 2016 $37 puts on Coca-Cola. Try any of our Foolish newsletter services free for 30 days . We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy .

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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