Munger convinced Buffett to change his view on investments – 11/29/2023 – Market

ANDstis the edition of newsletterr FolhaMercado this WednesdayMonday (29). Do you want to receive it from Monday to Friday, at 7am, In your email? Sign up below:

---

How Munger Shaped Buffett and Berkshire

Investor Charlie Munger, billionaire Warren Buffet’s right-hand man and vice chairman of Berkshire Hathaway, died this Tuesday, aged 99. The cause of death was not disclosed.

The nearly 60-year partnership between the duo has resulted in the success of Berkshire, a holding company that is today the ninth largest private company in the world by market value –US$782 billion (R$3.82 trillion).

“It would not be possible to build what Berkshire Hathaway is today without Charlie’s inspiration, wisdom and participation,” Buffett, 93, said in a statement.

It is attributed to Munger convincing your partner about a change in strategy: that of buying excellent businesses at reasonable prices, instead of just looking for reasonable businesses at excellent prices.

• In 2015, Buffett commented on the new approach: “Charlie has been suggesting this path for a few years, but I’m slow to learn.”

• Berkshire bought a 10% stake in China in 2008.

In interview published earlier this month by the American newspaper Wall Street Journal, Charlie Munger reinforced his position on how the so-called “ordinary investor”, one who is not a market specialist, should invest:

“Most people should probably just invest in index funds [ETFs, explicamos o que são aqui]. This is perfectly rational for someone who simply doesn’t want to think about it too much and has no reason to believe they have any advantage as a stock investor,” she stated.

• “Why should he try to choose his own actions? He doesn’t design his own electric motors or his own egg beater.”

Munger also commented on his lifestyle, another thing he shared with Buffett.

• “I’m not an excessive consumer, and I prefer my lifestyle on the cheap… Who with my wealth lives in the same house they built 70 years ago?”

---

Vibra rejects Eneva merger proposal

The board of directors of fuel distributor Vibra (formerly BR) rejected the “merger of equals” proposal presented by Eneva last Sunday night (26).

The collegiate said that it did not even analyze the merits of a possible merger, stating that the natural gas producer would have to “significantly improve” the terms presented for its financial advisors to analyze the offer.

• Among the terms used by Vibra are that the proposal is “unjustifiable” and “does not have any attractiveness” for its shareholders.

The “fusion of equals” cited in Eneva’s offer considered that shareholders on each side would represent 50% of the combined company’s shareholder base.

• The proposal generated a negative reaction from Vibra shareholders, with an assessment that it devalues ​​the company.

• One of the arguments was that the fuel distributor is worth more on the stock exchange (R$25.9 billion, at Friday’s price) than the gas producer (R$20.7 billion).

• According to calculations by BB Investimentos analysts, the offer should add a positive difference of R$2.01 for each Vibra share so that its shareholders maintain the same shareholding position in the new company.

In the merger proposalEneva had mentioned that the businesses of the two companies complement each other.

She also said that there would be room to offer electricity and natural gas to Vibra’s corporate client base, which is looking for alternatives to replace the use of fuel oil and diesel.

---

Hypermarkets lose space in Carrefour

Carrefour Brasil said this Tuesday that it will transform 40 units of its hypermarkets into Atacadão and Sam’s Club stores between 2024 and 2026, continuing the strategy that prioritizes cash and carry stores above all.

In numbers: the company ended the third quarter with 143 hypermarkets in the country, a drop compared to 170 at the end of 2022.

• Atacadão, the group’s wholesale brand, ended September with 361 units, while the Sam’s Club banner had 47 stores in the period.

Which explains: Cash and carry is the fastest growing sector among its peers in the country, according to consultancy NielsenIQ.

• The segment that offers wholesale to retail prices got a boost during the pandemic, when inflation eroded Brazilians’ purchasing power and attracted the middle class to these establishments.

• For every 100 households in Brazil, 73 buy at wholesale stores, while 62 shop at large supermarkets, according to Nielsen.

Atacadão’s main rivals are Assaí and Grupo Mateus, operating in the North and Northeast.

In addition to the wholesale and shopping club, Carrefour will also look at the growth of neighborhood stores, a segment in which the company operates under the Express brand. The message was from Abílio Diniz, one of the company’s main investors, in a presentation to retail analysts.

---

Women suffer property violence due to the wealth they generate

Women have advanced in gaining leadership positions and are demanding salary parity, but to a large extent they still delegate the management of their own wealth to their partners. And this leaves them vulnerable to abuse involving their assets, shows reporter Stéfanie Rigamonti.

Understand: Patrimonial violence happens when a man uses financial power or control of the family’s accounts as a way of dictating the direction of the relationship, or of punishing the woman after it ends.

Although it is not covered by law, property violence exists in various ways, from the most veiled to the most explicit, and affects women on a daily basis.

The issue gained prominence after presenter Ana Hickmann said in an interview last Sunday (26) that she was a victim of property violence, in addition to physical violence and psychological violence already reported.

• The presenter insinuated that her ex-husband destroyed her assets and accused him of forging signatures.

What to do? Finance experts heard by Sheet recommend that women manage their own money and think above all about their financial independence – in personal relationships and even at work.