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4 2014 ANNUAL REPORT
Steve Hills and, particularly, the infinitely patient
Gerry Rosberg—all board members—on behalf of
our Company.
The total amount generated by the sale of the Post
and aliated properties was a bit over $900 million,
plus whatever the Alexandria land ultimately brings.
(It will not be a large sum in this context.)
/ / /
Early in 2014, Warren Buett suggested we con-
sider a transaction in which Graham Holdings would
exchange our Miami television station and cash for
most of Berkshire Hathaway’s shares in Graham
Holdings. Here’s what was finally exchanged:
/
We gave Berkshire WPLG, which had 2013 net
revenues of $66 million and operating income of
$26 million (it was valued at $438 million); $328
million in cash; and shares of Berkshire Hathaway,
then worth $400 million.
/
In exchange, we received approximately 1.6 mil-
lion shares, about 22%, of our outstanding stock.
After the repurchase, we have about 5.8 million
shares outstanding.
The transaction represents a big change: WPLG had
been part of our Company since the early 1970s,
and we are proud of the station.
Warren had bought shares of The Washington Post
Company in 1973, quickly joined our board and,
in eect, become our lead director. (My mother,
Katharine Graham, then our CEO, had to overcome
some negative advice from people she normally
trusted. But, after one meeting with Warren and
Charlie Munger, she reached the conclusion that
these were the smartest businesspeople she had
ever met. The conclusion held up well over time.)
There was a period after 1986 when Warren left our
board. (He had bought 20% of the stock of Capital
Cities Communications, which had bought ABC;
both companies owned TV stations in Detroit.)
But he remained such a respected adviser to our
Company that when people were discussing the
then-new concept of lead directors at a confer-
ence she attended, Mrs. Graham said, “I have a lead
director who’s not a director.”
I’ve recounted in past reports how much Warren’s
advice has been worth to The Washington Post
Company/Graham Holdings. Kay took his advice
and switched pension advisers in the late 1970s.
Result: perhaps the most overfunded pension plan
in the Fortune 1000. He also recommended that
she consider repurchasing our stock, a most unusual
thing for public companies at the time. Over the
years, our share count decreased from 20 million at
the time of our public oering to the much smaller
number today.
Early in 2014, Warren Buffett suggested
we consider a transaction in which
Graham Holdings would exchange our
Miami television station and cash for
most of Berkshire Hathaway’s shares in
Graham Holdings.