Billionaire investor Warren Buffett on Wednesday announced that his firm Berkshire Hathaway had paid $2 billion for 20 percent of the stocks of Israeli toolmaker Iscar, years after purchasing the initial 80 percent in what at the time was Buffett’s largest buy outside of the United States. The company manufactures precision tools for the automotive, aerospace, and die-and-mold industries.
Buffett committed to keeping the company headquartered in Israel, which he described as the “most promising investment hub” outside the United States. The print edition of Israel’s Hebrew-language Yedioth Ahronoth carried an interview with Buffett:
“Israel is the leading, largest and most promising investment hub outside the United States,’ Buffett said. “[Iscar] will stay in Israel as long as I’m alive. We’re the world’s fifth-biggest investment firm, but for me, the number-one country is Israel, which is far ahead of larger and richer countries.”
The purchase is big news in Israel. Buffett’s photo was splashed across the front pages of Israel’s three highest-circulation newspapers: Israel Hayom, Yedioth Ahronoth, and Maariv. Israel’s leading business paper, Globes, and the country’s English-language daily Jerusalem Post also put the news on their front page.
“I’m not Jewish, but Israel reminds me of the United States after its birth,” Buffett said in his Yedioth interview. “The determination, motivation, intelligence and initiative of its people are remarkable and extraordinary. I’m a big believer in Israel’s economy.”
“I didn’t invest the money in any other country. That’s the strongest vote of confidence I can give you, no?” he added.
Asked what he had to say to Israelis, Buffett replied: “The United States and Israel – an unbreakable alliance.”
Founded in 1952 by German-born Stef Wertheimer, Iscar has 140 subsidiaries in 65 countries. Buffett has called Wertheimer and his son – and current Iscar chairman – Eitan Wertheimer “brilliant strategists and operators.”
“The most important thing from our point of view is that Buffett promised that as long as he lived, and we wish him good health, Iscar will not leave the borders of Israel,” Eitan Wertheimer said Wednesday.
The elder Wertheimer is a philanthropist and activist active in promoting Jewish-Arab co-existence in Israel. He has advocated a “Marshall Plan for the Middle East” to create jobs, alleviate poverty, and encourage regional peace.
Buffett, who rarely travels abroad, visited Israel in 2006 shortly after purchasing Iscar:
[Photo: Oren Kessler / The Tower]