Li Lu's 2nd Lecture in Columbia University

Check out this link

http://streetcapitalist.com/2010/06/24/li-lus-2010-lecture-at-columbia/

A Spinoff to Watch: Motorola Mobility

From valuehuntr, Posted: 22 Jun 2010 07:08 PM PDT

According to a WSJ article, Motorola will pump the bulk of its remaining cash into its handset and set-top box business when it spins off the unit in the first quarter of 2011. This could be an opportunity to invest in a debt-free business with plenty of cash to operate and grow.

The story, which cited unnamed sources, mentions that the company would buy back most of its debt, which stands at about $3.9 billion, and provide the mobile phone unit $3 billion to $4 billion of its cash.

It will also leave the cellphone company, to be called Motorola Mobility, without pension liabilities and most other debts, according to the story.

This would leave the rest of Motorola, which caters to enterprise customers and sells network equipment to operators, with the remainder of its cash, its pension obligations and all its other liabilities, the Wall Street Journal said. That business would be called Motorola Solutions.

The company’s cellphone unit has been struggling to compete with new smartphones and has not had a blockbuster phone since 2004. Its set-top box business suffered due to a weak economy and the wireless network equipment business was hit by a consolidation among telecom operators.

Analysts said it makes sense for its cellphone business, headed by Co-CEO Sanjay Jha, to get the bulk of the company’s cash and to be free from debt to help it in its turnaround.

The idea behind buying back most of Motorola’s debt is to leave the separated entities with clean balance sheets that could make acquisitions or be bought, the paper said.

But both Pompeii and another analyst, Gerry Granovsky of Moody’s, raised doubts about whether Motorola would indeed buy back the bulk of its debt, which is expected to total around $3 billion by the end of this year.

Granovsky sees Motorola allocating the long-term debt to Motorola Solutions, which will be run by Co-CEO Greg Brown. Unless the company has a big cash requirement, such as a share buyback or dividend payment, Granovsky said Brown’s unit may get its desired investment grade rating.

Motorola, which had $8.5 billion cash at the end of the first quarter, has said publicly that it expects to end 2010 with roughly $3 billion in debt after paying back debt due this year and finishing a $500 million buyback.

Li Lu: Possible Berkshire CIO Candidate?

(Check Li Lu's Columbia Lecture at the end of the link below. It should worth your time)

http://www.dailymarkets.com/stocks/2010/06/01/who-is-li-lu/
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Li Lu: Possible Berkshire CIO Candidate?

Posted: 17 May 2010 12:33 AM PDT

By Steve Jordon (World Herald)

Charlie Munger is interested in China, and now the Chinese can learn more about Munger thanks to an imaginative friend who, some have said, might handle Berkshire Hathaway’s investments some day.

Munger, vice chairman of Berkshire and longtime confidant of Berkshire CEO Warren Buffett, turned 85 last year. That’s an auspicious birthday among the Chinese, according to Li Lu, who met Munger several years ago.

Lu decided to surprise Munger with a translation of his biographical collection of speeches, writings and observations, “Poor Charlie’s Almanack,” a Ben Franklin-esque volume published in 2005.

Lu gave Munger a proof of the translated book on his 86th birthday, and the first copies were available for sale at this month’s Berkshire shareholder meeting in Omaha. Copies are just now filtering into bookstores in China, Lu said, out of an initial printing of 5,000 copies.

A professional translator took first crack at turning Munger’s pithy prose into Chinese, but Lu said he edited the final version himself because it would be difficult for someone else to convey Munger’s exact meaning in Chinese.

“I know how Charlie thinks,” Lu said. “It came out quite well.”

That Lu is in touch with Munger’s thinking is no surprise.

It was Munger who turned Buffett’s attention to the Chinese automaker BYD Inc., which resulted in a 10 percent ownership share by Berkshire. And it apparently was Lu who told Munger about BYD. Lu declined to discuss the matter, beyond his role with the translated book.

Lu also owns a substantial stake in BYD, and Munger once mentioned a “young Chinese-American partner” who had suggested BYD as an investment, according to the Seeking Alpha website. Munger has named Lu as an outstanding money manager, and at this year’s Berkshire shareholder meeting Munger said one of the candidates to take over investment duties at Berkshire had scored a 200 percent return with no borrowed money.

Munger didn’t say who the candidate was, but BYD had just such a substantial return.

Lu operates an investment fund out of the same office building in Pasadena, Calif., as the Berkshire division Wesco Financial, which Munger heads.

According to several news accounts, Lu was born in 1966 but separated as an infant from his parents, who were sent to labor camps during the so-called Cultural Revolution because they were intellectuals. His adoptive family was killed in a 1976 earthquake, and he was homeless for a year before finding his grandmother, who encouraged his education.

Lu was a principal student leader during the 1989 Tiananmen Square uprising, escaping to the United States later that year. He attended Columbia University from 1990 to 1996, earning a bachelor’s degree in economics, a law degree and an MBA at the same time.

The New York Observer magazine reported two years ago that Lu wrote a book about his experiences in China and used the royalties from the book and from working at a law firm to begin investing.

He had success on Wall Street with a high-risk hedge fund called Himalaya Capital Partners. One of his investors was the rock star Sting, plus many business luminaries.