Buffett Takes World’s Third-Richest Title as Ortega Falls
Warren Buffett is once again the world’s third-richest person.
The 82-year-old American investor regained the title after first ceding it to Spanish retail tycoon Amancio Ortega in August. Buoyed by a 49 percent jump in fourth-quarter profit, shares of Buffett’s Berkshire Hathaway Inc. have rallied 14 percent this year. That brings Buffett’s net worth to $54.6 billion, according to the Bloomberg Billionaires Index. He’s up $6.7 billion year-to-date.
Ortega, the 76-year-old founder of the Zara clothing chain, has seen his wealth decline amid fresh concern that Spain’s recession will hurt sales for his Inditex SA holding company. From a record high on Jan. 2, the shares have slumped 7.5 percent. He’s now worth $54.3 billion, down $3.2 billion year- to-date. Ortega slipped below Buffett before trading began in New York yesterday.
“Maybe it ultimately proves the wisdom of Buffett’s approach to riches -- buying good solid investment vehicles when they’re at prices that represent good value,” said Bruce McCain, who helps oversee more than $200 billion as chief investment strategist at the private-banking unit of KeyCorp in Cleveland. For Ortega, he said, “retail is a difficult area to be in an economy as troubled as the Spanish one.”
Buffett built Berkshire Hathaway over almost five decades through takeovers and stock picks. Earlier this month, the company reported net income of $4.55 billion in the fourth quarter, up from $3.05 billion in the same period in 2011. Much of the gains stemmed from derivatives bets. The billionaire uses put options to speculate on long-term gains in stock-market indexes in the U.S., Europe and Japan.
European stocks and the euro fell yesterday after data showed an unexpected contraction in German manufacturing and Cyprus’s president worked on a new plan to obtain a European bailout.
Ortega depends on his home country for a fifth of Inditex’s sales. With Spain’s unemployment rate above 20 percent, profit growth in the fourth quarter was the slowest in more than a year, according to a March 13 statement from the company. Its reported net income of 705 million euros ($908.8 million) also fell short of the average estimates of analysts surveyed by Bloomberg.
Buffett remains $12.7 billion behind Bill Gates, who earlier this week narrowed the gap between himself and Carlos Slim to less than $200 million.
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.
To contact the reporter on this story: Alex Cuadros in Sao Paulo at email@example.com
To contact the editor responsible for this story: Matthew G. Miller at firstname.lastname@example.org