Seabury Stanton (October 9, 1892 – October 19, 1971) was an industrialist from

New Bedford, Massachusetts New Bedford (Massachusett: ) is a city in Bristol County, Massachusetts. It is located on the Acushnet River in what is known as the South Coast region. Up through the 17th century, the area was the territory of the Wampanoag Native American p ...

who ran

Berkshire Hathaway Berkshire Hathaway Inc. () is an American multinational conglomerate holding company headquartered in Omaha, Nebraska, United States. Its main business and source of capital is insurance, from which it invests the float (the retained premiu ...

prior to its takeover by

Warren Buffett Warren Edward Buffett ( ; born August 30, 1930) is an American business magnate, investor, and philanthropist. He is currently the chairman and CEO of Berkshire Hathaway. He is one of the most successful investors in the world and has a net ...

in 1964.

Biography

Early life and career

Seabury Stanton was born on Oct. 9, 1892 in

. His father and grandfather had been

Yankee The term ''Yankee'' and its contracted form ''Yank'' have several interrelated meanings, all referring to people from the United States. Its various senses depend on the context, and may refer to New Englanders, residents of the Northern United S ...

whaling Whaling is the process of hunting of whales for their usable products such as meat and blubber, which can be turned into a type of oil that became increasingly important in the Industrial Revolution. It was practiced as an organized industr ...

captains in New Bedford. He attended the local schools, the

New Bedford Textile School The New Bedford Institute of Technology was a public college located in New Bedford, Massachusetts, United States. It was founded in 1899 as the New Bedford Textile School. History The New Bedford Textile School was funded under a bill that appr ...

, and

Harvard University Harvard University is a private Ivy League research university in Cambridge, Massachusetts. Founded in 1636 as Harvard College and named for its first benefactor, the Puritan clergyman John Harvard, it is the oldest institution of highe ...

, where he graduated in the class of 1915. The following year he married Jean Kellogg Austin (1892–1976) and began work in textile manufacturing as the treasurer for the Hathaway Manufacturing Company. Hathaway Manufacturing eventually became

after merging with Berkshire Fine Spinning Associates in 1955, becoming the largest surviving textile manufacturer in

New England New England is a region comprising six states in the Northeastern United States: Connecticut, Maine, Massachusetts, New Hampshire, Rhode Island, and Vermont. It is bordered by the state of New York to the west and by the Canadian provinces ...

with 15 mills. The company was founded in the nineteenth century with Horatio Hathaway's profits from whaling and the China Trade, but the textile industry in New England declined after

World War I World War I (28 July 1914 11 November 1918), often abbreviated as WWI, was List of wars and anthropogenic disasters by death toll, one of the deadliest global conflicts in history. Belligerents included much of Europe, the Russian Empire, ...

and didn't recover until after the

Great Depression The Great Depression (19291939) was an economic shock that impacted most countries across the world. It was a period of economic depression that became evident after a major fall in stock prices in the United States. The economic contagio ...

with the outbreak of

World War II World War II or the Second World War, often abbreviated as WWII or WW2, was a world war that lasted from 1939 to 1945. It involved the World War II by country, vast majority of the world's countries—including all of the great power ...

. In the late 1950s the industry was again in decline, facing low-cost competition from elsewhere in the United States and abroad. Stanton managed the company as president and his son Jack served as treasurer. Jack Stanton was expected to take over as president, but the Stantons were ousted before that took place. Seabury's brother, Otis Stanton, managed sales at the company and often conflicted with his brother, eventually selling his shares to Warren Buffett after a meeting at the

Wamsutta Club The Wamsutta Club is a private social club in New Bedford, Massachusetts, founded in 1866. It was a club for the affluent members of New Bedford's community, which at the time was supported by the flagging whaling industry as well as the up-and-com ...

. Seabury Stanton was a miller and a manager with an overriding aim to keep the business going but he was not a financial expert and he continued to plough back most of the company’s earnings into

working capital Working capital (WC) is a financial metric which represents operating liquidity available to a business, organisation, or other entity, including governmental entities. Along with fixed assets such as plant and equipment, working capital is consi ...

, despite ever decreasing cotton prices, resulting from increased competition at home and abroad.

Ousting of Stanton by Buffett

In 1962

began buying shares of Berkshire because he thought the company was selling at a discount to its actual value after noticing a pattern in the price direction of its stock whenever the company closed a mill. Eventually Buffett acknowledged that the textile business was waning and the company's financial situation was not going to improve. In 1964 Stanton made a verbal tender offer of $11 per share for the company to buy back Buffett's shares. Buffett agreed to the deal. A few weeks later Buffett received the tender offer in writing, but the tender offer was for only $11. Buffett later admitted that this lower (undercutting offer) made him angry.Buffett's Worst Trade
CNBC (February 26, 2009). Retrieved on July 8, 2011. Instead of selling at the slightly lower price, Buffett decided to buy more of the stock to take control of the company and fire Stanton.

Personal life

Seabury Stanton was Chairman and Director of the Northern Textile Association for many terms and an avid sailor in his free time. Stanton also published a book on Berkshire, titled ''Berkshire Hathaway, Inc. A saga of courage''. Stanton died on October 19, 1971, and is buried in

Dartmouth, Massachusetts Dartmouth (Massachusett: ) is a coastal town in Bristol County, Massachusetts. Old Dartmouth was the first area of Southeastern Massachusetts to be settled by Europeans, primarily English. Dartmouth is part of New England's farm coast, which co ...

Bibliography

References

{{DEFAULTSORT:Stanton, Seabury 1892 births 1971 deaths People from New Bedford, Massachusetts American chief executives Harvard University alumni Berkshire Hathaway people