Full Description

Berkshire Hathaway Inc. (Berkshire) is a holding company owning subsidiaries engaged in a number of business activities. The most important of these are insurance businesses conducted on both a primary basis and a reinsurance basis. Berkshire also owns and operates a number of other businesses engaged in a variety of activities. Berkshire’s insurance and reinsurance business activities are conducted through over 60 domestic and foreign-based insurance entities. In March 2008, it acquired 60% of Marmon Holdings, Inc. (Marmon). In November 2008, White Mountains Insurance Group, Ltd. (White Mountains) completed its exchange with Berkshire of runoff businesses. Berkshire exchanged about 95% of its interest in White Mountains for 100% of a White Mountains subsidiary, whose holdings consist of Commercial Casualty Insurance Co. and International American Group Inc.

Insurance and Reinsurance Businesses

Berkshire’s insurance businesses provide insurance and reinsurance of property and casualty risks world-wide and also reinsure life, accident and health risks world-wide. Berkshire’s insurance underwriting operations are includes GEICO and its subsidiaries, General Re Corporation (General Re) and its subsidiaries, Berkshire Hathaway Reinsurance Group, and Berkshire Hathaway Primary Group. GEICO’s principal insurance subsidiaries include Government Employees Insurance Company, GEICO General Insurance Company, GEICO Indemnity Company and GEICO Casualty Company. These companies primarily offer private passenger automobile insurance to individuals in 49 states and the District of Columbia. In addition, GEICO insures motorcycles, all-terrain vehicles, recreational vehicles and small commercial fleets and acts as an agent for other insurers who offer homeowners, boat and life insurance to individuals. GEICO markets its policies primarily through direct response methods, in which applications for insurance are submitted directly to the companies through the Internet, by telephone or through the mail.

General Re affiliates include Kolnische Ruckversicherungs-Gesellschaft AG (Cologne Re), an international reinsurer. General Re subsidiaries conduct business activities globally in 55 cities, and provide insurance and reinsurance coverages throughout the world. General Re provides property/casualty insurance, and reinsurance, life/health reinsurance and other reinsurance intermediary and risk management, underwriting management and investment management services. General Re’s property/casualty reinsurance business in North America is conducted through General Reinsurance Corporation. Reinsurance activities are marketed directly to clients without involving a broker or intermediary.

Through a subsidiary of Cologne Re, life, health, long-term care and disability reinsurance coverages are written on an individual and group basis. During 2008, approximately 43% of life/health net premiums were written in the United States, 29% were written in Western Europe and the remaining 28% were written throughout the rest of the world. The Berkshire Hathaway Reinsurance Group (BHRG) operates through a group of subsidiary companies, led by National Indemnity Company (NICO) and Columbia Insurance Company (Columbia). BHRG provides principally excess and quota-share reinsurance to other property and casualty insurers and reinsurers. The Berkshire Hathaway Primary Group is a collection of primary insurance operations that provide a variety of insurance coverages to insureds located principally in the United States. This business is written nationwide primarily through insurance agents and brokers.

Utilities and Energy Businesses

Berkshire owns an 88.2% interest in MidAmerican Energy Holdings Company (MidAmerican), an international energy company. MidAmerican’s businesses are managed as separate operating units. MidAmerican’s domestic regulated energy interests includes two regulated utility companies serving over 3 million retail customers and two interstate natural gas pipeline companies with approximately 17,000 miles of pipeline in operation and design capacity of about 7 billion cubic feet of natural gas per day. Its United Kingdom electricity distribution subsidiaries serve about 3.8 million electricity end users. In addition, MidAmerican’s interests include a portfolio of domestic independent power projects, a hydroelectric facility in the Philippines and a residential real estate brokerage firm in the United States.

Manufacturing, Service and Retailing Businesses

Marmon consists of approximately 130 manufacturing and service businesses that operate independently within 11 business sectors. These sectors are Building Wire, providing copper electrical building wire for residential, commercial and industrial construction; Construction Services, providing the leasing and operation of mobile cranes primarily to the energy, mining and petrochemical markets; Distribution Services, supplying specialty metal pipe and tubing, bar and sheet products to markets, including construction, industrial, aerospace and many others; Engineered Wire & Cable, providing electrical and electronic wire and cable for energy related markets and other industries; Flow Products, producing copper, aluminum and brass products and materials for the plumbing, heating, air conditioning, refrigeration, construction, automotive and industrial markets; Food Service Equipment, supplying commercial food preparation equipment for restaurants and shopping carts for retail stores; Highway Technologies, primarily serving the heavy-duty highway transportation industry with trailers, fifth wheel coupling devices and undercarriage products, such as brake parts and suspension systems, and also serving the light vehicle aftermarket with clutches and related products; Industrial Products, consisting of metal fasteners for the building, furniture, cabinetry, industrial and other markets, safety products, such as gloves for industrial markets, portable lighting equipment for mining and safety markets, and overhead electrification equipment for mass transit systems, and custom-machined brass, aluminum and copper forgings for the construction, valve and other industries; Retail Store Fixtures, providing shelving and other merchandising displays and related services for retail stores worldwide; Transportation Services & Engineered Products, including manufacturing, leasing and maintenance of railroad tank cars, leasing of intermodal tank containers, in-plant rail services, manufacturing of bi-modal railcar movers, wheel, axle and gear sets for light rail transit and gear products for locomotives, manufacturing of steel tank heads, and services, equipment and technology for processing and distributing sulfur, and Water Treatment equipment, including residential water softening, purification and refrigeration filtration systems, treatment systems for industrial markets, including power generation, oil and gas, chemical, and pulp and paper, gear drives for irrigation systems and cooling towers, and air-cooled heat exchangers.

McLane Company, Inc. (McLane) provides wholesale distribution and logistics services in all 50 states and internationally in Brazil to customers that include discount retailers, convenience stores, quick service restaurants, drug stores and supermarket chains. Shaw Industries Group, Inc. (Shaw) designs and manufactures over 3,000 styles of tufted and woven carpet and rugs, and laminate flooring for residential and commercial use under about 30 brand and trade names and under certain private labels. Shaw’s manufacturing operations are integrated from the processing of raw materials used to make fiber through the finishing of carpet.

Berkshire’s apparel manufacturing businesses include manufacturers of a variety of clothing and footwear. Businesses engaged in the manufacture and distribution of clothing products include Fruit of the Loom (FOL), Russell Corporation (Russell), Vanity Fair Brands (VFB), Garan and Fechheimer Brothers. Berkshire’s footwear businesses include H.H. Brown Shoe Group and Justin Brands. Acme Building Brands (Acme) manufactures and distributes clay bricks (Acme Brick), concrete block (Featherlite) and cut limestone (Texas Quarries). ISCAR Metalworking Companies (IMC) is a manufacturer of consumable precision carbide metal cutting tools for applications in a range of industrial end markets under the brand names ISCAR, TaeguTec, Ingersoll, Unitac, UOP It.te.di and Outiltec. IMC’s manufacturing facilities are located in Israel, United States, Germany, Italy, France, Switzerland, South Korea, China, India, Japan and Brazil. FlightSafety International Inc. (FSI) engages primarily in the business of providing training to operators of aircraft.