Spain’s Ortega Overtakes Buffett as World’s Third-Richest
The 76-year-old tycoon’s fortune rose $1.6 billion to $46.6 billion yesterday, according to the Bloomberg Billionaires Index, as shares of Inditex gained 3.8 percent to close at a record. That places the owner of the Zara clothing chain above the Berkshire Hathaway Inc. (BRK/A) chairman, who has a net worth of $45.7 billion and had ranked No. 3 on the index since its inception March 5.
Ortega’s wealth has surged 32 percent -- $11.4 billion -- this year amid a market rout in his native Spain, where policy makers are resisting pressure to formally request aid from the European Central Bank. Inditex boosted profit for 12 straight quarters by adding stores in emerging markets such as China while reducing its dependence on its home country, where unemployment hovers above 20 percent.
“Buffett’s holdings have done well recently, but not all of them,” said Walter “Bucky” Hellwig, who helps manage $17 billion at BB&T Wealth Management in Birmingham, Alabama. Ortega “has a more concentrated holding, and that implies more risk. You may have these fits and starts between them going forward.”
Raul Estradera, a spokesman for Inditex, declined to comment. Buffett, 81, didn’t return an e-mail message left with Carrie Sova, an assistant.
Inditex shares rose in Madrid yesterday, joining a rally of European stocks, after German Chancellor Angela Merkel’s government backed the ECB’s plan to buy bonds from debt-racked countries such as Spain. Berkshire Hathaway shares fell 0.5 percent in New York after increasing its cash hoard to the highest level in a year as Buffett pared bets on consumer- products stocks. On Aug. 3, the company posted a second-quarter profit that beat analysts’ estimates.
Ortega is $27.6 billion behind Mexican telecommunications tycoon Carlos Slim, the world’s richest person. Microsoft Corp. (MSFT) co-founder Bill Gates ranks No. 2 on the Bloomberg Billionaires Index with a $63 billion fortune.
The Spaniard became Europe’s richest man on June 13, when he passed Sweden’s Ingvar Kamprad, owner of retailer IKEA. Kamprad, founder of the world’s largest furniture seller, is worth $37 billion.
Buffett donated 22.1 million Berkshire Hathaway Class B shares to charity on July 6, according to a filing with the U.S. Securities and Exchange Commission. The shares are worth $1.9 billion at today’s closing price of $85.15 a share. Almost all of the stock went to the Bill and Melinda Gates Foundation.
The billionaire pledged in 2006 to give the majority of his fortune to charity and, after distributing about 20 percent of his Berkshire holdings, now donates 4 percent of his remaining shares each July. Buffett’s fortune has climbed 6.8 percent this year, or $2.9 billion.
Prior to his pledge, Buffett held almost all of his net worth in Berkshire Hathaway Class A shares. He owned 474,998 of those shares in March 2006, according to the company’s proxy statement. The shares would have been worth $60.7 billion as of yesterday’s market close.
Buffett now owns 350,000 Class A shares and 3.8 million Class B shares of Berkshire.
Buffett and Gates started the Giving Pledge in mid-2010 to encourage the ultra-rich to commit to donate most of their fortune to philanthropy. Since then, 81 families have signed it, according to the initiative’s website.
“My wealth has come from a combination of living in America, some lucky genes, and compound interest,” Buffett wrote in a June 2010 letter. In agreeing to donate 99 percent of his wealth, he said, “my family and I will give up nothing we need or want.”
The Bloomberg Billionaires Index takes measure of the world’s wealthiest people based on market and economic changes and Bloomberg News reporting. Each net worth figure is updated every business day at 5:30 p.m. in New York and listed in U.S. dollars at current exchange rates.
To contact the editor responsible for this story: Matthew G. Miller at email@example.com