Des Moines resident to become Berkshire Hathaway CEO by end of year, Warren Buffett says

Berkshire Hathaway's Warren Buffett said Saturday he wants Des Moines resident Greg Abel to take over the trillion-dollar conglomerate as CEO by year's end.

Buffett, the world's sixth-richest person and arguably its most famous investor, had named Abel as the Omaha-based company's successor in 2021. Buffett, called the Oracle of Omaha, said on May 3 at the company's annual meeting that he was springing his decision to move Abel to CEO on his board directors.

"I think ... the time has arrived where Greg should become the chief executive officer of the company at year end," said Buffett, adding that he would notify the company's 11 directors at the board meeting.

"I think they’ll be unanimously in favor of it," said Buffett, who received a long, sustained standing ovation after the announcement. "That would mean that at year end Greg would be the chief executive of Berkshire.

"I would still hang around and conceivable be useful in a few cases, but the final word would be what Greg said," said Buffett, adding that he had "zero" intention of selling any of his Berkshire stock.

"The decision to keep every share is an economic decision. Because I think the prospects are better under Greg's management than mine," Buffett said.

More: 7 things to know about Greg Abel, the Iowan in line to lead Berkshire Hathaway

At his 60th annual meeting, Buffett said Abel, too, was hearing his plans for the first time.

A 25-year Berkshire veteran, Abel, 62 and now vice chairman, is expected by investors and analysts to uphold the conglomerate's track record of investing in companies for the long haul and eschewing dividend payments to shareholders.

Berkshire, which owns railroads, insurance companies and an ice-cream maker, has been planning for decades for the eventuality when Buffett, 94, who has run the company since 1965, is no longer there.

Tim Cook, chief executive of Apple, in a post on X expressed confidence in Abel.

"There's never been someone like Warren, and countless people, myself included, have been inspired by his wisdom," Cook wrote. "It's been one of the great privileges of my life to know him. And there's no question that Warren is leaving Berkshire in great hands with Greg."

Abel is a longtime fixture in Des Moines, a regular dad who coaches his son's hockey and baseball teams and joins friends at the Iowa State Fair for concerts.

In a 2022 Des Moines Register profile, Shayne Ratcliff, whose son's hockey team shared practice times with Abel's son's team, said Abel was just like other dads, a volunteer coach on his son's team, who dug pucks out of the net after practice and handed out praise and fist bumps when the boys left the ice.

Like other parents, Abel just wanted to spend time with his kid, help him learn a sport and have fun, Ratcliff said at the the new $45 million, 300,000-square-foot RecPlex in West Des Moines.

"He's a regular guy," agreed Tom Hadden, West Des Moines' city manager, during a visit three years ago to the RecPlex.

Yet this regular guy, in addition to being designated as upcoming leader of a company that ranks sixth on the Fortune 500 list, is chairman of Berkshire Hathaway Energy and oversees MidAmerican Energy, Iowa's largest utility. It donated $5 million for the RecPlex naming rights, and Abel added his own check for at least $1 million.

Abel's friends say the Canadian, who came to Berkshire Hathaway when it acquired Des Moines-based MidAmerican Energy Holdings in 2000, is hardworking, low key and whip smart, a voracious reader who absorbs vast amounts of information.

More: Iowan Greg Abel is a ‘regular guy’ with a ‘shocking workload.’ He’s also Warren Buffett’s chosen successor.

And even though Abel travels the world leading Berkshire Hathaway's noninsurance companies — including the BNSF railway and other firms — he makes time to grab pizza and beer with friends, hit an Iowa State Fair concert, and schlep suitcases with other parents traveling with the hockey team.

Following in the footsteps of Buffett might seem intimidating for the more reserved Abel. But friends say he didn't seem fazed as he prepared to join the annual meeting stage in 2022 with Buffett, Charlie Munger, Buffett's longtime business manager who died in 2023, and Ajit Jain, who leads Berkshire Hathaway's insurance businesses.

Abel is a known quantity, steeped in the culture of the diverse conglomerate, which sells everything from Geico insurance to Pampered Chef cooking pans, Dairy Queen and Brooks running shoes, said Lawrence Cunningham, director of the Weinberg Center for Corporate Governance at the University of Delaware.

"There's going to be anxiety and uncertainty" when the change in leadership finally comes, Cunningham said. "But Greg's prepared."

Mark Oman, a retired Wells Fargo executive in Des Moines, said three years ago that his friend Abel has many of the same financial, analytical and leadership skills Buffett has.

"I'm bullish on Berkshire Hathaway, certainly in part because Warren Buffett is its leader," said Oman, who's a director of First American Financial Corp., a California title service company.

"But Greg Abel also is an incredible leader," he said. "We wouldn't be having this conversation if Warren Buffett didn't think so as well."

Abel, who declined to be interviewed for the article, grew up in a working-class neighborhood in Edmonton, Alberta, according to the Horatio Alger Association of Distinguished Americans, which named him to its list in 2018. 

His mother worked at home and his father was in sales in the oil town, with its boom-and-bust economic cycles.

"Sometimes, people had jobs, sometimes, they didn't," Abel said in a Horatio Alger video. But they "were all working hard to try to advance their families."

Abel said his parents emphasized education as the foundation for a bright future. "One thing I saw early in my life was that with your family around you, with good friends, it gives you the opportunity to dream," he said.

His first job was delivering advertising fliers, getting about a quarter of a penny for each one.

"You had to do the job and do it right," said Abel, who also cleaned discarded bottles and redeemed them for deposits.

Abel for a time was a laborer for a forest products company, and in high school as well as college, he worked for a company that filled fire extinguishers. "I think hard work leads to good outcomes," he told the Horatio Alger Association.

He graduated from the University of Alberta in 1984 with a degree in commerce and joined PricewaterhouseCoopers in Edmonton as an accountant, then moved to the company's San Francisco office.

In 1992, Abel joined CalEnergy a 500-employee geothermal power company that was a client of the accounting firm. CalEnergy bought Des Moines' MidAmerican Energy Holdings for roughly $4 billion in cash and debt, a deal that closed in 1999. CalEnergy adopted MidAmerican's name.

The following year, an investor group led by Buffett bought MidAmerican for about $9 billion, taking the publicly traded company private.

By then, Abel was MidAmerican Energy Holdings' president, adding the title of CEO in 2008 and becoming board chairman in 2011. MidAmerican Energy Holdings renamed itself Berkshire Hathaway Energy in 2014 and has grown into a diversified global holding company with about 24,000 employees. 

Abel joined Berkshire Hathaway's board as vice chairman of noninsurance operations in 2018. At the same time, Jain was named vice chairman to lead Berkshire's insurance operations, sparking speculation that Abel and Jain, now 73, were competing for Buffett's job.

In 2021, Munger dropped a big hint when he said Abel would "keep the culture" of the vast and decentralized business. A couple of days later, Buffett confirmed Abel would become CEO of the company if anything happened to him.

Abel received $21 million in total compensation for his Berkshire Hathaway work, this year's company proxy statement shows.

At the May 3 annual meeting, Abel told a teenager it would take "hard work" to someday reach her goal of working at Berkshire Hathaway. "I think hard work takes all of us a long ways in life.

"And I would never diminish that there are a lot of things that matter in life, but if you start with a great work ethic and have that attitude ... you're going to go a long ways in life and find great enjoyment," Abel said.

Reuters contributed to this story.

This story was updated to add new information and a video.

This article originally appeared on Des Moines Register: Des Moines resident to become Berkshire Hathaway CEO by end of year, Warren Buffett says