Bloomberg on Danaher

As many of you know, I’m a big fan of Danaher. The company is quiet and prefers to stay out of the limelight. At Bloomberg, Devon Pendleton and Tom Maloney discuss the Rales brothers’ charitable donations.

Steven and Mitchell formed Danaher in the early 1980s, converting a real estate investment trust into a shell for scooping up struggling, little-known manufacturing businesses.

They were among the first in North America to adopt the Japanese management philosophy of kaizen, which emphasizes efficiency and continuous improvement.

That’s led to a shift in focus to life sciences, illustrated by Danaher’s acquisition last year of the biopharma unit of General Electric Co., whose chief executive officer, Larry Culp, previously headed Danaher for 14 years.

The kaizen-inspired operating system has been credited for the company’s consistent returns. Its stock has outperformed Warren Buffett’s Berkshire Hathaway Inc. by almost 7% over the past 30 years.

Along with efficiency, another of the brothers’ hallmarks is a reliance on credit. The Rales built up Danaher through a slew of debt-financed takeovers, leading Forbes to dub them “raiders in short pants” in a 1985 profile.

Posted by on June 30th, 2021 at 11:42 am


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