Buffett ups remaining gift to his kids' charities
OMAHA, Neb. (AP) — Warren Buffett is celebrating his 82nd birthday by giving each of his three children a big present: about $600 million worth of his company's stock for their charitable foundations.
Buffett announced the gifts in a letter made public Thursday, saying he is rewarding his children for the way they've run their foundations.
The new contributions, added to previous gifts, mean they'll each receive about $2.1 billion in stock over time. In 2006, Buffett promised to give roughly $1.5 billion of Class B Berkshire Hathaway stock to each of the foundations his children run as part of a plan give the bulk of his fortune to charity.
The biggest share of Buffett's $44.7 billion fortune will go to the Bill & Melinda Gates Foundation. Another sizable gift will go to the Susan Thompson Buffett foundation that Buffett created with his first wife. He did not change those pledges on Thursday.
Buffett said he decided to increase the amount his children will receive because of the progress they've made.
"I'm very pleased about how all three of them have handled the contributions in the last six years," Buffett told The Associated Press.
Buffett said he is feeling fine and this decision was not prompted by any concern about his health. Berkshire Hathaway's chairman and CEO has been undergoing radiation treatment for prostate cancer this summer, but he has said his doctors do not believe the disease is life-threatening.
Each of Buffett's three children all chose a different focus for their foundations, based on their own interests.
Howard Buffett, 57, is helping farmers in impoverished nations produce more to help end world hunger. Susie Buffett, 59, is strengthening early childhood education and looking for ways to reduce teen pregnancy. Peter Buffett, 54, wants to empower women and girls worldwide through education, collaboration and economic development to end violence against women.
"They've done everything I've hoped for and more with the original gifts," Buffett said.
Peter Buffett said it's nice to hear his father praise the charitable work he has been doing. This latest gift should enable him and his wife to accomplish more with their foundation, he said.
"It means we get to go deeper essentially," Peter Buffett said.
Susie Buffett said her dad's latest gift is exciting because she'll able to do more to help improve early childhood education.
"I'm glad we're not getting it until next July because there are a lot of things to think about," Susie Buffett said.
Howard Buffett is traveling in Africa with limited access to phone or email and could not immediately be reached on Thursday.
As part of his giving plan, Warren Buffett has always said that all of his Berkshire stock — which today includes 350,000 Class A shares and 3,770,934 Class B shares — will eventually go to charity.
The pledges to the five foundations that Buffett outlined in 2006 accounted for about 85 percent of his stock. Buffett said that increasing the amount each of his three children will receive now means that about 90 percent of his stock is spoken for.
Buffett has also been making smaller gifts of Berkshire stock to mostly unnamed charitable foundations. He said those would continue.
"As the years go by, I will commit more and more to get to that 100 percent," Buffett said.
In his will, Buffett has specified that any shares he hasn't already pledged to charity at the time of his death will go to his Susan Thompson Buffett Foundation. And he has requested that all proceeds from his giving be spent within 10 years after his estate is closed.
Buffett has been giving each of the five foundations 5 percent of his total pledge annually since 2006.
The gradual manner Buffett is giving his stock away makes it more difficult to say how much the gifts are worth because Berkshire's stock price changes. The $2.1 billion estimate is based on current stock prices.
Buffett said he estimates that his kids will wind up with roughly double the amount to give away because the change he made. Each of Buffett's children has been receiving stock worth about $50 million to $65 million for several years. Starting next year, they will receive stock worth roughly $100 million to $125 million.
Buffett said he's still never been tempted to give up his day job and become a full-time philanthropist. Instead, he's trusting others to distribute his wealth.
"They're doing a better job than I could, and I've got plenty to do running Berkshire," he said.
Buffett's Berkshire Hathaway is an Omaha-based conglomerate with more than 80 subsidiaries, including insurance, manufacturing, railroad, utility, furniture and restaurant firms. It also holds major investments in companies such as Wells Fargo & Co., Coca-Cola Co., Washington Post Co. and IBM.
Its holdings also include the Omaha World-Herald newspaper, which first published Buffett's letter outlining the latest gifts to his children's foundation.
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Berkshire Hathaway Inc.: www.berkshirehathaway.com