Monday, June 26, 2006
Noble News : Buffett gives $37 billion to Gates and family foundations
By Robert MacMillan and Mark McSherry 1 hour, 42 minutes ago
NEW YORK (Reuters) - Warren Buffett, the world's second-richest person, is donating about $37 billion -- more than 80 percent of his fortune -- to foundations run by his friend Bill Gates and by the Buffett family.
The move is the biggest-ever single act of charitable giving in the United States.
Sunday's announcement by Buffett, 75, comes just days after Microsoft Chairman Gates said he would move away from his day-to-day role at the software giant to focus more on charity work, and highlights the close friendship of the world's two richest men.
Gates, 50, is a bridge partner of Buffett's and a director of Berkshire Hathaway, Buffett's investment firm. Buffett serves on the board of the Washington Post Co. with Gates' wife Melinda.
In a letter to the Bill and Melinda Gates Foundation, Buffett, said he will set aside 10 million shares of Berkshire class B common stock for the foundation.
Based on the stock's per-share price of $3071.01 as of Friday, the total amount for the Gates foundation comes to about $30 billion.
That is the largest commitment to a philanthropic cause ever made by one person in the United States, said Stacy Palmer, editor of the Chronicle of Philanthropy.
"Even if you look at what (John D.) Rockefeller and (Andrew) Carnegie gave historically -- even if you do it in today's numbers, it doesn't come close to that," she said.
The Gates foundation is one of the world's richest philanthropic organizations.
It has committed millions of dollars to fighting diseases such as malaria and tuberculosis in developing countries, and to education and library technology in the United States.
Buffett, chief executive of Berkshire Hathaway, is worth an estimated $44 billion, according to Forbes magazine. That makes him the world's second-richest man behind Gates, who is worth about $50 billion.
Buffett took over Omaha, Nebraska-based Berkshire in 1965, and has transformed it from a struggling textile maker into a $141.8 billion company with investments in undervalued securities and purchases of well-managed, easy-to-understand businesses.
Its stock investments include blue-chip names such as Coca-Cola Co. and Procter & Gamble Co. Berkshire also owns some 50 businesses, including Geico auto insurance, Benjamin Moore paint and Dairy Queen ice cream.
In a letter to Gates and his wife, Buffett wrote: "You have committed yourselves to a few extraordinarily important but underfunded issues, a policy that I believe offers the highest probability of your achieving goals of great consequence."
Gates and his wife said in a statement on their foundation's Web site: "We are awed by our friend Warren Buffett's decision to use his fortune to address the world's most challenging inequities, and we are humbled that he has chosen to direct a large portion of it to the Bill & Melinda Gates Foundation."
Buffett also pledged 1 million shares to a foundation established by himself and his late wife, Susan Thompson Buffett, and 350,000 shares each to the foundations of children Howard, Susan and Peter.
In letters to the recipients, Buffett said he will award the gifts every year for the rest of his life.
Buffett is in "excellent health," he wrote to the Gates foundation, but said he is writing a new will to ensure that the stock is distributed after his death.