Lunch with Warren Buffett sets new record

Winner's name withheld, but some suggest top bid came from China

NEW YORK / BEIJING - The price of a private lunch with revered investor Warren Buffett topped last year's bid on the final day of the weeklong contest, after the winning bidder agreed to pay more than $2.63 million.

When the online bidding ended on Friday night with eight bids on eBay, the top bid fell short of the record, standing at $2,345,678, according to the website. However, sources with Bloomberg were quoted as saying that the victorious bidder wanted to beat the record set last year by $100 when an unidentified donor paid $2.63 million for the steakhouse meal with the 80-year-old billionaire.

This is the 12th year that Buffett has volunteered to hold the charity auction fundraising lunch with whoever pays the highest price. All the proceeds will go to the Glide Foundation, a non-profit organization that provides social services to the poor and homeless in the San Francisco Bay Area.

Each year, thousands of Buffett admirers are attracted to his hometown of Omaha, Nebraska, for the Berkshire Hathaway's annual shareholders' meeting, where they line up for hours to hear Buffett fielding questions on finance, public policy and life. The winner of this year's auction and up to seven friends will meet Buffett at New York's Smith and Wollensky steak house on a mutually agreed upon date.

Past winners have said their incentives to bid were Buffett's influence and the charitable cause to support the poor and homeless. Zhao Danyang, manager of Hong Kong-based Pureheart China Growth Investment Fund, won the bid in 2008 with a pledge of $2.1 million, three times higher than the previous record. He said at the time Buffett's views would benefit his whole life.

Though organizers didn't release the identity of the winner, there was speculation that the top bid came from China. Zhao and another Chinese winner, Duan Yongping, founder of Subor Electronics Industry Corporation and BBK Electronics Group, raised more than half of the proceeds from Buffett's charity lunch in 2008.

"It's very likely that the winner is a Chinese, since there has been a strong 'Buffett influence' in China and many viewed this opportunity as a chance to become famous and show off their wealth," said Yuan Wenzhao, deputy general manager of Beijing-based Hanji Investment Group.

"There might be a good chance for the winners to use Buffett's recognition to open doors to new business contracts, but I don't think that one lunch with him will make their fortunes soar," he said.

Paying more than $2 million for lunch may seem very excessive to some people but others just think it's totally worth it.

Richard Xu, senior managing director of Genesis International Capital LLC in New York, said he could understand why a Chinese entrepreneur or investor would want to spend some personal time with Buffett.

"Whether from the US or China, a successful investor would want to seek guidance from and talk to the legendary investor about the problems they face," said Xu.

Xu said he admires Buffett for making value choices on his investments. Although Buffett has not made that many Chinese investments, he has been successful in those he picked, such as PetroChina, a Chinese oil and gas producer, and Chinese automaker BYD.

"Warren Buffett only invests in what he knows and understands. During the tech bubble in 1999 and 2000, he did not make any investments in high-tech companies. Right now, he's interested in China. I think he will spend a small percentage of his money on China, but his investment will be focused in the US and European countries," said Xu.

Calling it a "fine wine" effect, Kevin Pollack, managing director of Paragon Capital LP in New York, said the lunch bid would only get higher and higher.

"With each passing year, Warren Buffett has even more experience and wisdom to share," said Pollack, who believes that the new winner will "end up with plenty of valuable advice, investment ideas and contacts, and an experience that they'll remember for the rest of their life."