Warren Buffett ended years of speculation about who would succeed him at Berkshire Hathaway by saying Vice Chairman Greg Abel would take over as chief executive officer if he were to step down.
"The directors are in agreement that if something were to happen to me tonight, it would be Greg who'd take over tomorrow morning," Buffett said, according to a CNBC report.
Buffett, 90, has never provided a timetable for his departure.
Abel, 58, has overseen Berkshire's non-insurance businesses since 2018, after building its Berkshire Hathaway Energy unit into a major US power provider.
Many analysts and investors had viewed the Edmonton, Alberta, native as Buffett's most likely successor, and committed to preserving Berkshire's corporate culture.
"Simple, understated, very knowledgeable, but humble at the same time, and also serious," said Steve Haberstroh, a partner at CastleKeep Investment Advisors in Westport, Connecticut.
Ajit Jain, 69, a vice chairman overseeing Berkshire's insurance businesses, was another CEO candidate.
But Buffett told CNBC that Abel's relative youth "makes a real difference."
Buffett's hand may have been forced after Vice Chairman Charlie Munger, 97, let slip at Berkshire's May 1 AGM while discussing Berkshire's decentralised business model that "Greg will keep the culture."
Buffett has built Omaha, Nebraska-based Berkshire since 1965 into a $628 billion empire with dozens of businesses such as Geico auto insurance, the BNSF railroad, Dairy Queen ice cream and See's Candies.
Its shares are performing well in 2021 but have trailed the Standard & Poor's 500 over the last decade, reflecting Berkshire's size and Buffett's struggle to deploy its now $145.4 billion cash pile.
Succession has been a central issue since 2006 when Buffett, then 75, discussed it in his annual shareholder letter.
Buffett's eldest son Howard is expected to become non-executive chairman, while investment managers Todd Combs and Ted Weschler are in line to become chief investment officer.
While Abel lacks Buffett's charisma and showmanship, he won Buffett's confidence for his commitment to Berkshire's culture, long-term thinking and ability to spend money wisely.
"Greg has a lot of experience dealing with regulators and making acquisitions, and a track record of managing many people," said longtime Berkshire shareholder James Armstrong, president of Henry H Armstrong Associates in Pittsburgh.
Buffett called Abel "a first-class human being" in a 2013 video message.
"There's a lot of smart people in this world, but some of them do some very dumb things," Buffett said. "He's a smart guy who will never do a dumb thing."
Abel graduated in 1984 from the University of Alberta. He worked at PricewaterhouseCoopers and energy firm CalEnergy before joining Berkshire Hathaway Energy, then known as MidAmerican Energy, in 1992, which Berkshire took over in 2000.
Abel became MidAmerican's chief in 2008, replacing David Sokol, who many investors thought was being groomed to replace Buffett and was given a broader role.
Sokol resigned in 2011 after Berkshire learned he had invested in Lubrizol while successfully persuading Buffett to buy the chemical company. Regulators took no action.
Berkshire Hathaway Energy benefited from its ability, unusual in the utility industry, to retain earnings rather than pay dividends.
That freed Abel to buy Nevada utility NV Energy and Alberta electric transmission company AltaLink while expanding into renewable energy. The unit also controls one of the largest US residential real estate brokerages.
