[ by Larry Goldfarb ]

For years, analysts have compared Leucadia National Corporation with Berkshire Hathaway.  It's a business model that Mr. Cumming and Mr. Steinberg have pursued from the beginning. The two men, who were classmates at Harvard Business School, banded together to take over Talcott National in the late 1970s.  Over the years, the partners have developed a style that looks quite a bit like that of Berkshire.  For example:

• Just as Berkshire was a struggling textile maker before Mr. Buffett arrived, Talcott was a far different animal from its current form. It was largely a specialized lender, founded in 1854 with a history that included helping finance sock purchases for the Union Army during the Civil War.
• The company has shown a fondness for reducing its tax bill, amassing tax assets like net operating losses that will be put to use helping Jefferies' earnings.
• Leucadia then turned into an enormously acquisitive deal machine, with Mr. Cumming and Mr. Steinberg acquiring reputations for being intelligent stock pickers. The company has orchestrated 28 takeovers since 1994 alone, according to Standard & Poor's Capital IQ.
• They emulated Mr. Buffett's style of website design.  Leucadia maintains a minimal Web site and long annual investor letters with musings on the current state of the markets and the world more broadly.

But also like Buffett who occasionally seems to tire of a boring yet profitable approach and dives into a larger enterprise like Gillette or Salomon Bros –with mixed results, so to has Leucadia.  Its purchase of Jefferies seems very similar to actions of Berkshire. By buying the remainder of the Jefferies Group, Mr. Cumming and Mr. Steinberg are adding a growing investment bank to Leucadia's eclectic stable of holdings. It's in line with the Berkshire approach of buying up an array of undervalued companies, in the hopes of creating enormous shareholder value. It’s also in line with Buffett having a long relationship with the acquired manager.  

For more information, please read [NYT Dealbook, 11/13/12]