The more I dig into Berkshire Hathaway, the odder it gets. Did you know the company wasn’t listed on the New York Stock Exchange until November 1988?
In 1929, Berkshire Fine Spinning Associates was created through the merger of the Berkshire Cotton Manufacturing Company (founded in 1889) with Oliver Chace’s textile companies (founded in 1839). In 1955, Hathaway Manufacturing Company merged in too, creating Berkshire Hathaway.
It took another seven years, 1962, before the company caught the eye of Warren Buffett, who purchased his first shares for just over $7 each. Two years later, the company offered to buy Buffett’s shares for $11 3⁄8. Buffett claims that was less than the verbally agreed $11 1⁄2 per share and thus rather than selling, he purchased the majority of the company.
Those shares today (November 2023) are worth $531,288, down a bit since last month when I made this graph:
But this post isn’t about that incredible growth, nor how much that is when compounded over the past 60 years. No, this post is about the very odd fact that from 1929 until 1988, this was a public company but not listed on a stock market. Maybe that was common before the 1929 crash and its long recovery, but that wasn’t the norm in 1988 and far from the norm today.
To the right is the very small story from November 30, 1988 in The New York Times, announcing that this Omaha holding company run by a billionaire takeover specialist was listed on the New York Stock Exchange for $4,750 per share.
Which, of course, opens the question, was Berkshire Hathaway just traded over the counter before 1998? Or was there some other mechanism for companies older than the SEC, that is lost to time?