Warren Buffett has ditched his usual hands-off approach with this particular investment — and so has his young protégé.
The Nebraska billionaire — whose Berkshire Hathaway conglomerate typically gives free rein to management at the companies it buys — is grappling with a crisis at his Benjamin Moore paint brand, which has spilled over on the watch of his 29-year-old financial assistant.
Tracy Britt, a handpicked favorite of Buffett who has an office down the hall to his at Berkshire’s Omaha headquarters, was tapped last year to tackle Benjamin Moore’s sliding market share and serves as the company’s chairman.
Late last month, sources said, Britt led a Friday afternoon conference call with Benjamin Moore employees, surprising them with the news that CEO Bob Merritt had abruptly left the company after just 14 months on the job.
Benjamin Moore, which said in a Sept. 28 statement it will name a replacement for Merritt “in the coming week,” didn’t give a reason for Merritt’s departure, and had yet to name a new CEO as of late Sunday.
Officials at Berkshire andat the 130-year-old company, based in Montvale, NJ, didn’t comment.
The bombshell exit of Merritt, a former restaurant exec tapped last year to reverse a tailspin at Benjamin Moore, is a rare embarrassment for Buffett, who had fired Merritt’s predecessor, Denis Abrams, just 15 months earlier.
The reason for 61-year-old Merritt’s departure couldn’t be confirmed, but some insiders say he appears to have clashed with Britt.
Having arrived at Berkshire in 2009 after graduating from Harvard Business School, Britt “swooped in” last summer at Benjamin Moore’s offices when Buffett fired Abrams, an insider said.
“She’s hyper-organized and very no-nonsense,” according to the source. “Everybody seemed impressed initially, or at least hopeful about the situation.”
Britt had her work cut out for her, however, as she tackled Benjamin Moore’s corporate culture, which several sources said has long been dominated by “good old boys,” with few women or minorities in upper-management positions.
“People used to joke that the only color you’d find in Montvale [headquarters] was white,” according to a former employee.
Many workers last month were taken aback by the sudden ouster of Merritt, a respected manager who had won praise for a turnaround of the Outback Steakhouse chain.
Merritt last year signaled he would repair Benjamin Moore’s relationships with dealers, who have accused the paint giant of strong-arming them into exclusive distribution agreements while milking them for cash.
But some dealers say Benjamin Moore has continued to use intimidation tactics, yanking inventory financing arbitrarily and demanding payments for advertising programs that never materialize.