WORLD
Buffett admits ‘mistake’ over Sokol`s Lubrizol shares
Baku, May 2 (AZERTAC). US billionaire investor Warren Buffett has faced uncomfortable questions from shareholders in his company about the resignation of a top executive.
David Sokol had violated Berkshire Hathaway`s insider-trading rules, he told the meeting in Omaha, Nebraska.
Mr. Sokol traded shares worth $10m (£5.9m) in Lubrizol before convincing Mr Buffett to mount a $9bn takeover.
Mr. Buffett admitted he had "made a big mistake" by not pressing Mr. Sokol when he mentioned the investment in passing.
Berkshire Hathaway earlier said its first quarter profits had dropped more than half - a fall of more than $2bn - partly because of insurance losses associated with the natural disasters in Japan and New Zealand.
Mr. Sokol, who ran an energy utility for the company, had been widely tipped to succeed Mr. Buffett, 80, as chief executive before his resignation last month, when it emerged he had bought Lubrizol shares in January.
"He violated our insider-trading rules and he violated the principles I lay out every two years to our managers," Mr. Buffett said.
Mr. Buffett has previously revealed that Mr. Sokol made a "passing remark" about a personal investment in Lubrizol.
Lubrizol jumped 28% on the New York Stock Exchange on 14 March when Mr. Buffett announced a deal to buy the company.
Mr. Buffett runs Berkshire Hathaway`s more than 70 subsidiaries, which employ more than 250,000 people, with the help of his 87-year-old vice-chairman, Charles Munger, and 20 others at the firm`s headquarters.