Wesco Financial Corp., which is being acquired by majority shareholder Berkshire Hathaway Inc., reported 4 percent lower profit in the fourth quarter.
The Pasadena company, which has businesses in insurance, furniture rental and steel services, on Saturday said it had net income of more than $10.8 million ($1.53 per share), compared with $11.3 million ($1.58) a year earlier. Adjusted to exclude realized net investment gains and impairment losses, the profit was $11.4 million.
The company reported income for its subsidiaries but not revenue. Its Wesco property and casualty insurance business had underwriting and investment income gains of $24.8 million. Precision Steel had income of $773,000, and CORT furniture rental business had income of $141,000.
“The operations of CORT and Precision Steel, although improved, continue to reflect the effects of weak economic conditions,” Wesco said in a statement.
Full-year net income rose 36 percent to $72.21 million ($10.14).
Warren Buffett’s Berkshire Hathaway earlier this month said it reached an agreement to buy the roughly 20 percent it does not own of Wesco, run by longtime associate and Berkshire Vice Chairman Charlie Munger, in a cash-and-stock deal worth more than $547 million. The Omaha, Neb.-based conglomerate more than 30 years ago acquired its nearly 80 percent stake in Wesco,
The cash-and-stock deal, which still needs to be approved by shareholders, will give each Wesco shareholder $386.55 per share, either in cash or Berkshire Class B common stock. The final price could change based on gains or losses in Wesco's investment portfolio, the amount of time it takes to complete the deal and other factors.
Shares were up 67 cents, or less than a percent, to $390.60 in Monday midday trading on the New York Stock Exchange.
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