Warren Buffett's 'most gruesome mistake' was buying Dexter Shoe. Here's the story of his $9 billion error.
Warren Buffett's "most gruesome mistake" was buying Dexter Shoe in 1993, a Maine shoemaker that soon collapsed under pressure from cheap foreign imports.
"I gave away 1.6% of a wonderful business ... to buy a worthless business," Buffett said in his 2007 letter to shareholders. The so-called Oracle of Omaha acquired Dexter for 25,203 Class A shares, worth $433 million at the time. While Buffett was wildly wrong about Dexter's prospects, he did recognize the threat that would soon sink the company: cheap, imported shoes from low-wage countries. However, he joked that "someone forgot to tell" Dexter's managers and workers about that challenge, as their factory was "highly competitive against all comers."
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