Warren E. Buffett, the nation's most famous investor, anticipates more financial services mergers but is wary of the notion that bigness alone is a virtue.
He was notably mum on takeover rumors swirling around Wells Fargo & Co., the San Francisco banking company of which he is the top shareholder. On the other hand, he said he saw no compelling reason for a merger involving American Express Co., where he also has a major stake.
The usually reticent Mr. Buffett offered his comments during a jam- packed press conference in the midst of a weekend of events leading up to the annual meeting of Berkshire Hathaway Inc., his investment vehicle.
"My comment on consolidation is that there will be more," he said, but then added that bigger is not always better. Instead, "bigger is just bigger."
Mr. Buffett, through Berkshire Hathaway, owns about 8% of Wells Fargo, an estimated 10.5% of American Express, and 9.5% of Freddie Mac, according to the investment company's 1997 annual report. It also owns smaller stakes in First Empire State Corp. and U.S. Bancorp.
During the recent surge of super-size bank merger announcements, Wells Fargo has increasingly been the focus of rumors because of its lackluster performance during the two years since it bought First Interstate Bancorp.
Other Berkshire Hathaway shareholders, gathered here for the meeting, said they expect Wells to be bought by U.S. Bancorp or perhaps even by a Japanese bank.
But Mr. Buffett would only say that the banking company "has done fine by us."
Meanwhile, he voiced confidence that American Express can and maybe should remain independent despite sweeping consolidation in financial services.
"American Express will do fine on its own," said Mr. Buffett. "It's got a terrific manager, Harvey Golub, and it's got some very special assets. I don't know what the future will bring in consolidation, but American Express is a superb operation."
Merrill Lynch & Co. is also a company that can stand alone, he said.
When asked whether Travelers Group chief executive Sanford I. Weill had talked with him before Travelers announced its planned merger with Citicorp, Mr. Buffett said: "No, we don't want anybody to give us a call before things happen. We really don't. Sandy Weill wouldn't need to call me, and he would know better than calling me."
