"It's Buffett and Gates merging in a way for charitable purposes," Kilpatrick
said.
Buffett has long said limiting the spread of nuclear weapons is the greatest
challenge facing mankind. And Kilpatrick said Buffett probably agrees with the
Gateses' concerns about population control, disease and education.
In a statement, Bill and Melinda Gates applauded Buffett's decision.
"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," the couple said.
Buffett suggested that his children should focus their charitable resources
on needs that would not be met otherwise.
"Focus the new funds and your energy on a relatively few activities in which
HGB (Howard G. Buffett Foundation) can make an important difference," Buffett
wrote. He included the same paragraph of advice in the letters to each of his
children.
Buffett said he plans to earmark 10 million B shares for the Gates
Foundation, 1 million B shares for the Susan Thompson Buffett Foundation named
in honor of his wife and 350,000 shares for the three foundations run by each of
his children.
Buffett plans to give each foundation 5 percent of his total pledge each year
in July.
In the interview with Fortune, Buffett acknowledged that the foundations may
sell off the Berkshire stock to raise cash. But Buffett said he doesn't think
that will affect the price of the stock because the gifts will be spread over
time.
"I would not be making the gifts if they would in any way harm Berkshire's
shareholders," Buffett told Fortune. "And they won't."
But Kilpatrick said this announcement is still likely to prompt some people
to sell Berkshire stock on Monday morning. Kilpatrick said he doesn't think this
will hurt the company in the long run especially because it might be added to
the S&P 500 index in the future, which would help the stock.
Buffett's health has been the subject of speculation. He has said a
succession plan is in place at Berkshire but refuses to name a successor.
In the letters, Buffett wrote, "My doctor tells me that I am in excellent
health, and I certainly feel that I am."
Berkshire owns a diverse mix of more than 60 companies, including insurance,
furniture, carpet, jewelry, restaurants and utility firms. And it has major
investments in such companies as H&R Block Inc., Anheuser-Busch Cos. and
Coca-Cola Co.
