Warren Buffet Long Term Investor
Warren is very much a long term investor and some times, but very very rarely, he has had to change his mind and cut his losses.
One example of that was the Investment that Berkshire Hathaway made in TESCO.
Tesco seemed to be ahead of the pack and was trading across the Globe. But perhaps had lost their eye on the ball a failed to see the likes of Aldi and Lidl starting to take market share.
They had a business venture in the USA Fresh n Easy but that always seemed to be struggling. Any non American business always finds it hard it in the USA. Not always so hard if a UK company buys an existing American business but Tesco started a fresh. Kind of makes sense as the business was called Fresn N Easy.
They also were expanding in to South Korea using advertising at Subway and Tube Stations so that commuters could order their purchases ready to pick up.
They had stores in Eastern Europe and in China.
Attending TESCO s AGM
I attended the AGM in Nottingham in 2011 and was very impressed. The company seemed really focused and appeared to know where it was going. The Chairman then was the very capable Sir David Reid (Knighted 2012).
They had previously been some management changes in that the previous CEO Sir Terence “Terry” Leahy retired in March 2010.
Nottingham AGM 2011
At the Nottingham AGM in 2011 the chairman was Sir David Reid a Scottish chartered accountant and he chaired the AGM extremely well. His ambition for Tesco was for it not to be the biggest company in the world but to be one of the best valued company’s in the world.
I have to admit I was impressed at that AGM. They allowed questions from non shareholders who in theory had no right to address the meeting. They handled all kinds of questions including critical ones in a fair and open handed way.
Cardiff AGM 2012
I attended the AGM in Cardiff in 2012 when there was a new Chairman. To say he didn’t have a clue would be an understatement. In terms of chairing the meeting and communicating he was totally useless. That was Richard Broadbent which by comparison with Sir David Reid he appeared to be totally lost at Sea. To be far he did his best and he had been thrown in at the deep end!
Having been a substantial holder in Tesco for me the writing was on the wall. The company had lost its way and I sold my holdings.
Can you imagine at the AGM of a company trying to expand in to the USA , South Korea to be told that they could not produce a map showing where there key UK stores were. For the very many keen supporters who wanted a TESCO when travelling in the UK. Some thing that they used to DO!
Later of course the Accounting Scandal was revealed coupled with the fact that TESCO had 5 yes FIVE corporate Jets.
Ok a Jet or two could be useful but really and truly you can hire one if you really need one. Her Majesty the Queen hasn’t got a Jet nor has the British Prime Minister but dear old TESCO had five. Jack Cohen the founder of TESCO would have been turning in his Grave.
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