Shares of Berkshire Hathaway (BRK.B) plummeted 5.09% in Monday's pre-market trading session following Warren Buffett's surprise announcement that he will step down as CEO at the end of the year. The legendary investor, who has led Berkshire for six decades, revealed his plans during the company's annual shareholder meeting on Saturday.
Buffett, 94, told attendees that he would recommend Greg Abel, currently the vice chairman of non-insurance operations, to succeed him as CEO. The Berkshire Hathaway board unanimously approved Abel's appointment on Sunday, with Buffett set to remain as chairman after the transition.
The news of Buffett's impending departure sent shockwaves through the investment community. Despite Abel being the designated successor since 2021, the timing of the announcement caught many by surprise. Investors are grappling with the prospect of Berkshire Hathaway without its iconic leader at the helm, leading to the significant sell-off in the company's stock.
While Buffett assured shareholders that he has no plans to sell his Berkshire shares and will continue to provide guidance in an advisory role, the market reaction reflects concerns about the company's future direction. Greg Abel, though highly regarded within Berkshire, will face the challenge of filling the shoes of one of the most successful investors in history and maintaining the company's stellar track record.
As the market digests this pivotal moment in Berkshire Hathaway's history, investors will be closely watching how the transition unfolds and assessing the potential impact on the company's long-term strategy and performance.
