Munger defends Sokol share deal (Financial Times)

Charles Munger, the long-standing business partner to Warren Buffett, has defended David Sokol even as the former senior Berkshire Hathaway executive remains under fire for buying shares in a chemicals company less than two months before its sale to Mr Buffett.

The scrutiny now facing Mr Sokol “was inevitable, because of the optics of the situation”, Mr Munger told the Financial Times. “I don’t think he was trying to do anything immoral or take advantage of anyone. It was just a glitch.”

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Years ago my children through the Li Lu fund bought into BYD and years later Berkshire bought some BYD,” he said. “And Dave went on the board. I stayed out of it.

Mr Munger conceded Mr Sokol’s Lubrizol trades were similar to his family’s BYD investment “in one sense”, in that Berkshire ended up buying stakes in both companies.

“I don’t want to criticise his comparisons,” Mr Munger said. “Even now he says he would do it slightly differently had he had to do it all over again.”

Source: FT

Munger Says He Told Buffett of BYD Stake, Stayed Out of Berkshire's Talks

“I certainly suggested that Berkshire look at investing in something that the Mungers were already invested in, but we’d been in it for years,” he said today in a telephone interview.

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“I had Dave look at it, because I knew I couldn’t talk Warren into buying into the damn thing by myself,” Munger said. “It’s a new technology-type investment. But David went over there, and he made the deal for Berkshire.” Buffett is Berkshire’s chairman and chief executive officer.

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Munger said his family holds a “little more” than half of the fund with the BYD investment, and that he didn’t participate in Berkshire’s discussions on its deal.

“I recused myself,” Munger said. “But there’s no question about it, that I caused Dave’s original interest.” He declined to comment further.

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