If a Chinese stock investor purchases a large quantity of shares of a company via a stock trading app, can he participate in the company’s decision-making?

Yes, he can. Warren Buffett did exactly that—the Berkshire Hathaway company famously originated this way. Beginning in 1962, Buffett’s partnership gradually acquired shares of Berkshire Hathaway, a textile mill on the verge of bankruptcy. At the time, Buffett’s strategy was to buy shares before the mill shut down and liquidated some of its fixed assets—anticipating that the company would then repurchase part of its own stock. Unexpectedly, however, the mill’s CEO reneged at the last minute: the final announced repurchase price was $11.375 per share—$0.125 less than the previously agreed-upon $11.500. Although Buffett still earned a solid return, the management’s breach of trust infuriated him. In response, Buffett began aggressively buying more Berkshire shares—and ultimately gained control of the company at an average purchase price of $14.86 per share. After taking over Berkshire Hathaway, Buffett realized the textile business had reached its end—and that he simply couldn’t make it work. In 1981, Buffett publicly acknowledged his investment in Berkshire Hathaway as a mistake.

(13) 'Value Investing in Practice': Analysis using Hudson General Corporation as an example

• Kohala Development Business: • Kohala is a real estate development company located on the Kohala Peninsula in Hawaii; Hudson General holds a 50% equity stake in it. • Kohala’s Current Status: • Following a $22.6 million loss in 1997 (including $17 million in asset impairment losses), Kohala incurred another $5.6 million loss in 1998. • Based on the above revenue performance, the valuation of the Kohala joint venture should be based on its liquidation value: • Recovery rates for non-land assets: • Cash: 100% recoverable • Mortgaged receivables and notes: 80% recoverable • Foreclosed properties and other assets: 50% recoverable • Total value: $3.9 million • Less $0.9 million in accounts payable → net assets of $3.0 million • Hudson General’s 50% stake corresponds to $1.5 million. • Land Assets: • 1,820 acres of land—partially developed and wholly undeveloped. • Hudson General holds a 50% equity interest, entitling it to rights over 910 acres. • Per appraisal, land value ranges from $15,000 to $20,000 per acre; thus, the total 1,820-acre parcel is valued between $27 million and $36.4 million. • Using the lower bound of the range, the value is $27 million. • Summary: • After deducting a 6% transaction cost on land assets, Kohala’s total liquidation value is approximately $14 million ($13.5 million × 94% + $1.5 million). • Hudson General’s Overall Valuation: • $70 million: cash proceeds from liquidating the parent company;