Jay Pritzker and his brother, Robert, began collecting industrial companies, now totaling about 175 under the Marmon name with sales of $7.5 billion last year. The family added other businesses, too, including the Hyatt chain of hotels.
When their descendants couldn’t decide on Marmon’s future, Buffett offered a solution in 2008: Sell it to Berkshire and let it grow inside the Omaha-based conglomerate.
The industrial company that Pritzker assembled, now called Marmon Holdings, is Berkshire Hathaway Inc.’s least-known mega-business, a maker of wire, owner of train cars, supplier of industrial parts and employer of nearly 19,000 people with operations in 23 countries.
Marmon had a colorful history even before Nicholas Pritzker, a Russian immigrant, set up a law office in Chicago in 1907.
Marmon Motor Car Co., formed in 1902, produced fine autos, including the car that won the first Indianapolis 500 in 1911: the Marmon Wasp, so named for its long, pointed, drag-reducing tail.
Marmon eventually became part of Marmon-Herrington, which manufactured axles and other heavy-duty equipment, and later joined the Colson Co., also an industrial manufacturer.
Jay and Robert Pritzker acquired Colson in 1953 and in 1964 elevated the Marmon name because of its reputation for innovation, engineering and performance.
Jay Pritzker died in 1999. Robert Pritzker ended his career in 2002, succeeded as chairman by Jay’s son Tom Pritzker and new Chief Executive John Nichols. In 2006, Frank Ptak became CEO, continuing today.
Berkshire’s 2008 transaction settled the family issues with Marmon. Berkshire paid $4.8 billion for 63.6 percent of Marmon, agreeing to buy the rest over the next several years at prices determined by Marmon’s earnings.
Berkshire paid $1.5 billion for an additional 16.6 percent in 2010; $1.4 billion for 9.8 percent in 2012; and $1.47 billion for all but a few remaining shares in 2013.
Total paid: about $9.2 billion. In 2015 Forbes magazine listed 11 Pritzker family members as among the nation’s wealthiest, with a combined net worth of $29 billion.more » « less