1995: Would Buffett sit on the board of a company making a hostile takeover?

AUDIENCE MEMBER: Mr. Buffett, my name is Liz Pruce (PH), I’m from New York City.

I was wondering, on your acquisition criteria — I know part of that is that Berkshire Hathaway won’t participate in unfriendly takeovers. I wondered how that philosophy may or may not apply to your role as a member of the board of several other companies.

WARREN BUFFETT: That’s an interesting question. And I haven’t been on the board of any company where the CEO has brought to the board the question of a hostile takeover.

Can you think of anything I’m forgetting? No, and — but there’s no rule that that can’t happen.

So, I don’t know exactly what I would do if that came along. That’s a very good question.

I used to be — I used to have a whole different attitude on that. I mean, in effect — we actually — if you go back 40 years, we bought, in effect, control of companies.

Well, in the case of Berkshire, Malcolm Chace, the chairman, was all in favor of us buying our stock in Berkshire. But Seabury Stanton, the president, would not have been in favor of it, and Seabury was the — was managing the business.

So, it wasn’t hostile, but Seabury would not have been in favor of it. It would — but Malcolm would’ve been.

So, I don’t know what the situation would be today if somebody walked in Gillette or Cap Cities, or someplace like that.

I don’t think it’s going to happen, but I have not — I don’t have any policy on it at this point.

What do you think we’d do, Charlie?

CHARLIE MUNGER: I don’t think our behavior is totally predictable. (Laughter and applause)

WARREN BUFFETT: And he’s right. (Laughter)