In his annual letter to shareholders released over the weekend, one of the world’s richest men praised the East Tennessee entrepreneurs behind two of his major business acquisitions.
Warren Buffett, chairman of Berkshire Hathaway, said Clayton Homes which Berkshire acquired for $1.7 billion in 2003 and Pilot Travel Center which Buffett’s investment group plans to buy an 80% share of by 2023, are both generating annual pre-tax earnings of more than $1 billion.
“Each company was started by a young man who had graduated from the University of Tennessee and stayed put in Knoxville,” Buffett said in saluting the entrepreneurs behind the multi-billion-dollar Knoxville companies. “Neither had a meaningful amount of capital nor wealthy parents. Jim Clayton, after several other business ventures, founded Clayton Homes on a shoestring in 1956, and “Big Jim” Haslam started what became Pilot Travel Centers in 1958 by purchasing a service station for $6,000.”
In 2020, Clayton Homes revenues jumped 17.1% to $8.6 billion and pre-tax earnings rose 13.9% to $1.25 billion “driven by increases in units sold and revenue per home sold,” Berkshire Hathaway said in its annual report.
In 2018, Buffett’s Berkshire Hathaway paid $2.76 billion for an initial 38.6% stake in Pilot Travel Centers, according to insurance filings. The Haslam family plans to maintain a 10% ownership share in Pilot, the nation’s biggest chain of truck stops in the country. Berkshire Hathaway did not break down results for Pilot in its financial filings released Saturday.