New York: Matthew Rose, chief executive officer of railroad Burlington Northern Santa Fe Corporation, welcomed Warren Buffett as his company's new owner while showing analysts and hedge-fund managers the door.

Buffett's Berkshire Hathaway Incorporated completed the buyout yesterday after winning the approval of Burlington Northern investors.

The deal, valued at $100 (Dh367) a share, allows Rose to hand out returns of nearly 300 per cent, plus dividends, to investors who bought stock the day he was named chief executive in 2000. The problem, he said, is that shareholders with that length of commitment are dwindling in number and influence.

"When I started as CEO 10 years ago, the typical investor had a time frame of three to five to seven years," Rose said in an interview.

"Year-by-year, that's gotten shorter."

The increased focus on short-term results, fuelled by real-time media and quarterly analyst calls, can be a distraction for a railroad executive who needs to buy locomotives that run for 20 years and put down tracks that last for 40, Rose said.

Burlington Northern said last month it would commit $2.4 billion this year to capital projects, including track, signal systems and locomotives, about $240 million less than in 2009.

"The money I spend this year really won't pay off for three, four, five or seven years down the road," said Rose.

"There's the advent of the hedge fund which has changed the time horizon of what satisfies the institutional investor."

In Buffett, the second-richest American, Rose reports to a boss renowned for his buy-and-hold strategy. Berkshire is the biggest investor in Coca-Cola and American Express, and Buffett has held those stocks for more than two decades even as both trade below their top prices in the 1990s.

Berkshire also owns insurance subsidiaries like Geico, manufacturers such as Clayton Homes, and energy firms like MidAmerican.

Long-term goals

"I think that Rose and Warren Buffett are on the same wavelength," said David Kass, a professor at the University of Maryland's Robert H. Smith School of Business.

"Buffett expects his managers to take a long-term perspective, maximising profit long-term rather than setting short-term targets."

The Burlington Northern deal, for about $26.7 billion, is an "all-in wager" on the US economy and will produce profits for Omaha, Nebraska-based Berkshire for the next century, Buffett has said.