BILL & MELINDA GATES and WARREN BUFFETT

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THE WORLD'S RICHEST MEN IN £32 BILLION GIVEAWAY  -  27 JUNE 2006

The world's richest men, the computer magnate Bill Gates and the financier Warren Buffett, announced a $60 billion (£32 billion) alliance yesterday to attack global poverty and disease.

Bill Gates with wife Melinda and Warren Buffet

The decision by Mr Buffett to hand most of his vast personal fortune to a foundation run by Mr Gates and his wife Melinda is unprecedented both in scale and ambition. It marked the latest chapter in America's great philanthropic tradition which, for more than 150 years, has encouraged the country's extremely wealthy to give money to the poor.

During a joint appearance in the grandiose New York Public Library, itself a monument to early 20th century philanthropy, Mr Gates said of the gift: "It's almost scary. If I make a mistake with my own money it just doesn't feel the same as making a mistake with Warren's money."

Mr Buffett, known as the "Sage of Omaha" for his uncannily successful investment record, caused some laughter by promising not to assess Mr Gates's efforts more than once a day.

Looking at the Microsoft founder, he explained: "You can do a better job of giving it away than I can."

Mr Buffett was asked time and again why he had not handed all the money to his three children and responded: "I am not an enthusiast for dynastic wealth, particularly when the alternative is six billion people having much poorer 'hands' in life than we have." But the financier, 75, did give stock worth several billion dollars to foundations run by his three children. Around 80 per cent of his $44 billion fortune will go in annual instalments to the Bill and Melinda Gates Foundation for as long as the couple live.

Mr Gates, the chairman of Microsoft, recently announced that he would be spending less time with his company and more time on his philanthropic interests. His foundation aims to reduce inequality, particularly in the developing world and to improve education in America. It says it is "guided by the belief that every life has equal value".

It has funded large programmes to fight mass killers in the Third World such as Aids, malaria and tuberculosis, as well as to public libraries in America. Mr Buffett said the couple had committed themselves "to a few extraordinarily important but underfunded issues, a policy that I believe offers the highest probability of your achieving goals of great consequence".

The sums of money involved are huge. The gift is the largest in American history and will allow the foundation to spend close to $3 billion (£1.7 billion) a year, about a quarter of the United Nations annual budget. That will greatly increase the already substantial influence enjoyed by Mr and Mrs Gates, to whom few doors are closed.

The couple said they were "awed" by the contribution and invited Mr Buffett to join them on the foundation's board. Their work presented "a tremendous opportunity to make a positive difference in people's lives", they said. In some ways, Mr Buffett is an odd companion for Mr Gates. He has steered clear of technology stocks for years and represents an older and less self-conscious America. Known for his titanic thirst for Coca-Cola and appetite for red meat, he has a reputation for frugality.

But he also has a long-stated admiration for Mr Gates. "If Bill had started a hot-dog stand he would have become the hot-dog king of the world. He will win in any game," he said.

Mr Buffett, who still lives in the Omaha home he bought for $30,000 (£17,000) and nicknames his private jet "The Indefensible", has long warned his children that they would not get all his money.

Instead 53-year-old Susie, 53, a housewife, 51-year-old Howard, a photographer, and 48-year-old Peter, a musician, will receive large bequests to run their own foundations.

"They'll be wealthy, there's no question about that, but the idea of dynastic fortune turns me off," he once said. "The idea that you hand over huge positions in society simply because someone came from the right womb … I just think it's almost un-American."

Mr Buffett denied suggestions that his decision might be linked to poor health. "My doctor tells me that I am in excellent health and I certainly feel that I am," he said.

That will be a relief for American investors, who have a well-grounded faith in all Mr Buffett's doings. Anyone who invested $1 in his company 40 years ago would have seen it grow to $20,000. That amounts to 100 times the stock market return over the same period.

Although Mr Buffett and Mr Gates are confronting some of the most intractable problems in the world, experts have judged positively the foundation's efforts so far. Followers of Mr Gates believe that his business acumen will help achieve better results than those of charities and governments working towards the same ends. The foundation has 275 staff, which is now expected to grow to around 500. Based at an anonymous building in Seattle and devoid of signs, some have nicknamed it "The Undisclosed Location".

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Warren Buffet announcement

WARREN BUFFETT DISHES OUT BILLIONS TO CHARITY - 26 JUNE 2006

The world's second-richest man has announced that he will give an estimated 85 per cent of his $44 billion (£24 billion) fortune to charity. Warren Buffett, who made most of his money from investments, said in a statement that he would start transferring shares in his Berkshire Hathaway conglomerate to various charities from July.

He plans to give the majority of the money to The Bill and Melinda Gates Foundation, a charity set up by Bill Gates, the Microsoft founder, to fund medical research and educational grants.

Mr Buffett explained the motivation behind his generosity in an interview with Fortune magazine. "I know what I want to do, and it makes sense to get going," he said. Mr Buffett, 75, the son of a Congressman, reportedly bought his first shares on the stock market at the age of 11.

The majority of his fortune is concentrated in Berkshire Hathaway, a company with interests ranging from insurance to property, energy and jet leasing. Mr Buffett said in his statement that the value of his first gift to the Gates foundation would enable it to increase spending by about $1.5 billion.

"I greatly admire what the Bill and Melinda Gates Foundation is accomplishing and want to materially expand its future capabilities," he said. "In the future I expect the value of my annual gifts to trend higher in an irregular but eventually substantially manner".

AN EXPENSIVE NIGHT OUT, BUT ALL IN A GOOD CAUSE

NEW YORK (Reuters) - It will cost more than half a million dollars for a successful bidder to dine with Warren Buffett, with bidding for that privilege in an online charity auction on eBay Inc. now reaching a record $500,100.

Buffett, the 75-year-old chairman of Berkshire Hathaway Inc., will dine with up to eight people, as he has since 2000, to benefit the Glide Foundation, a San Francisco non-profit that helps the poor, hungry and homeless.

Mohnish Pabrai, an Irvine, California investor, placed the $500,100 high bid, topping a $500,000 bid from "fastisslow." He also topped a $460,200 bid earlier Monday by "value4567."

"Hopefully we'll prevail, but it's clear there are now three bidders, and the bidding could well get fast and furious," said Pabrai, an unsuccessful bidder in past years, in an interview.

Warren Buffet - Cover of Fortune Magazine

WARREN BUFFETT GIVES AWAY HIS FORTUNE - 25 JUNE 2006

The world's second richest man - who's now worth $44 billion - tells editor-at-large Carol Loomis he will start giving away 85% of his wealth in July - most of it to the Bill & Melinda Gates Foundation.

NEW YORK (FORTUNE Magazine) - We were sitting in a Manhattan living room on a spring afternoon, and Warren Buffett had a Cherry Coke in his hand as usual. But this unremarkable scene was about to take a surprising turn.

"Brace yourself," Buffett warned with a grin. He then described a momentous change in his thinking. Within months, he said, he would begin to give away his Berkshire Hathaway fortune, then and now worth well over $40 billion.

This news was indeed stunning. Buffett, 75, has for decades said his wealth would go to philanthropy but has just as steadily indicated the handoff would be made at his death. Now he was revising the timetable.

"I know what I want to do," he said, "and it makes sense to get going." On that spring day his plan was uncertain in some of its details; today it is essentially complete. And it is typical Buffett: rational, original, breaking the mold of how extremely rich people donate money.

Buffett has pledged to gradually give 85% of his Berkshire stock to five foundations. A dominant five-sixths of the shares will go to the world's largest philanthropic organization, the $30 billion Bill & Melinda Gates Foundation, whose principals are close friends of Buffett's (a connection that began in 1991, when a mutual friend introduced Buffett and Bill Gates).

The Gateses credit Buffett, says Bill, with having "inspired" their thinking about giving money back to society. Their foundation's activities, internationally famous, are focused on world health -- fighting such diseases as malaria, HIV/AIDS, and tuberculosis -- and on improving U.S. libraries and high schools.

Up to now, the two Gateses have been the only trustees of their foundation. But as his plan gets underway, Buffett will be joining them. Bill Gates says he and his wife are "thrilled" by that and by knowing that Buffett's money will allow the foundation to "both deepen and accelerate" its work. "The generosity and trust Warren has shown," Gates adds, "is incredible." Beginning in July and continuing every year, Buffett will give a set, annually declining number of Berkshire B shares - starting with 602,500 in 2006 and then decreasing by 5% per year - to the five foundations. The gifts to the Gates foundation will be made either by Buffett or through his estate as long as at least one of the pair -- Bill, now 50, or Melinda, 41 -- is active in it.

Warren Buffet - July 2001

LINKS

Statement from the Bill and Melinda Gates Fountation [25 Jun '06]

17 May 2006[Money]: Buffett pays £200m for slice of Tesco

8 May 2006[Money]: Buffett: 'I don't buy from deal flippers'

6 March 2006[Money]: Buffett rails at pay and perks for executives

Billionaires bond over bridge

A foundation with very deep pockets

Blair's Africa 'gimmick'

An interview with Buffett

How the giveaway will work

The force called the Gates Foundation

Should you leave it all to the children?

Letters from Buffett

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