Chicago Bridge and Iron (CBI)

One of Berkshire holdings approaching 10% ownership.

Fluffy shareholder letter.

Balance sheet at $4.2B in Goodwill (~ half of all total assets of $9.3B), $350M in cash and $1.5B in LT debt. The tangible book value is -$1.3B. This is one bad balance sheet. It seems that before Shaw acquisition there was not much LT debt nor a lot of Goodwill. So, all this comes from Shaw it seems. They spent $3.4B on Shaw acquisition and added $3.3B in goodwill.

I am sure that people at Berkshire have competence advantage here. But, I don’t find myself comfortable enough to invest here.


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