Charlie Munger, who helped Warren Buffett build Berkshire Hathaway into an investment powerhouse, has died at a California hospital.
He was 99.
Berkshire Hathaway said in a statement that Munger’s family told the company that he died on Tuesday at the hospital just over a month before his 100th birthday.
“Berkshire Hathaway could not have been built to its present status without Charlie’s inspiration, wisdom and participation,” Buffett said in a statement.
The famous investor also devoted part of his annual letter to Berkshire shareholders earlier this year to a tribute to Munger.
Munger served as Buffett’s sounding board on investments and business decisions and helped lead Berkshire for more than five decades and served as its longtime vice chairman.
Munger had been using a wheelchair to get around for several years but he had remained mentally sharp. That was on display while he fielded hours of questions at the annual meetings of Berkshire and the Daily Journal Corp. earlier this year, and in recent interviews on an investing podcast and also with The Wall Street Journal and CNBC.
Munger preferred to stay in the background and let Buffett be the face of Berkshire, and he often downplayed his contributions to the company’s remarkable success.
But Buffett always credited Munger with pushing him beyond his early value investing strategies to buy great businesses at good prices like See’s Candy.
“Charlie has taught me a lot about valuing businesses and about human nature,” Buffett said in 2008.
Buffett’s early successes were based on what he learned from former Columbia University professor Ben Graham. He would buy stock in companies that were selling cheaply for less than their assets were worth, and then, when the market price improved, sell the shares.
Munger and Buffett began buying Berkshire Hathaway shares in 1962 for US$7 and US$8 per share, and they took control of the New England textile mill in 1965.
Over time, the two men reshaped Berkshire into the conglomerate it is today by using proceeds from its businesses to buy other companies like Geico insurance and BNSF railroad, while also maintaining a high-profile stock portfolio with major investments in Apple and Coca-Cola.
During the entire time they worked together, Buffett and Munger lived more than 2,400 kilometres apart, but Buffett said he would call Munger in Los Angeles or Pasadena to consult on every major decision he made.
“He will be greatly missed by many, perhaps by nobody more than Mr. Buffett, who relied heavily on his wisdom and counsel. I was envious of their friendship. They challenged each other yet seemed to really enjoy being in each other’s company,” Edward Jones analyst Jim Shanahan said.
Munger grew up in Omaha, Nebraska, about five blocks away from Buffett’s current home, but because Munger is seven years older the two men didn’t meet as children, even though both worked at the grocery store Buffett’s grandfather and uncle ran.
When the two men met in 1959 at an Omaha dinner party, Munger was practicing law in Southern California and Buffett was running an investment partnership in Omaha.
Buffett and Munger hit it off at that initial meeting and then kept in touch through frequent telephone calls and lengthy letters, according to the biography in the definitive book on Munger called “Poor Charlie’s Almanack: The Wit and Wisdom of Charles T. Munger.”
Munger built a fortune worth more than US$2 billion at one point and earned a spot on the list of the richest Americans. Munger’s wealth decreased over time as he gave more of his fortune away, but the ever increasing value of Berkshire’s stock kept him wealthy. (AP)