By: The Chief
A rare Sunday alert coming from me, but I have inside information regarding a phone call placed by CA Governor Gavin Newsom. My sources tell me in the wake of the utility’s continued “zombie apocalypse,” shutting the power off for days with little or no warning, has irked our supreme leader so much he placed a call to Warren Buffett late Saturday night. No official word yet if this is the same “red line” phone Ronald Reagan installed to communicate directly with the Russians, alas here is what I have been told. Newsom has told Buffett he is fed up with PG&E’s lack of competence and morals, to the point that he wants the entire company sold and a new leadership team in place. Buffett has more than enough cash as his investment vehicle “Berkshire Hathaway” to make the purchase. My sources, (notice that’s plural) tell me Newsom wants Berkshire to buy the utility and be taken private. This will cut out as William likes to say the 90-day calendar and other reporting requirements with both Wall St, and the SEC.
Here in lies the problem, as corrupt and incompetent as PG&E is, the governor is acting illegally. He is not a shareholder, or an executive of the troubled utility. The decision to be made about a sale is up to the executives, and then voted on by the shareholders not the Governor. Why is he reaching out before another company has the chance? Is this because the city of San Francisco, where he used to infest as mayor, was rebuffed at their attempt to buy the company last week?
It’s not out of the question as Berkshire owns utilities in Iowa, Illinois, South Dakota, Nevada, and in the United Kingdom. There is no doubt he could be a qualified buyer, but why is the governor contacting him? Were prices discussed? What about concessions from the California Public Utility Commission? Since the governor appoints that board. I am sure a ton of SEC violations are occurring right now. If you are a shareholder…well, you’re getting wiped out, bondholder? Same. Union? You’ll be just fine.
Stay tuned but prepare to see movement on PG&E stock Monday, as this story will leak.