Law Commons^™

Berkshire Versus Kkr: Intermediary Influence And Competition, Lawrence A. Cunningham

GW Law Faculty Publications & Other Works

Kathryn Judge of Columbia University documents how financial intermediaries persistently impose high fees compared to the value rendered, attributes this to political influence, and suggests countervailing policy strategies, including stoking competition and enhancing disclosure to reduce excessive transaction costs. In this solicited comment, I concur with Judge's findings and prescriptions by adding a paired example: that of Berkshire Hathaway versus Kohlberg Kravis Roberts. In the field of corporate acquisitions, these rivals are opposites, Berkshire shunning intermediaries and generating virtually no transaction costs while KKR feasts on multiple and lavish fees. The contrast reflects broader differences between Berkshire and private equity …