At the its annual shareholders meeting in Memphis on May 7, O. Mason Hawkins, co-manager of Longleaf Partners Fund (LLPFX) told attendees that for the first time in its history, the fund has added a stake in Berkshire Hathaway (4.5%). His remarks at the gathering were reportedly similar to the statement made in the fund’s report for the first quarter.

In the report Hawkins and co-manager G. Staley Cates explained the move: “The company’s misunderstood derivative contracts created optically messy short-term results. In addition, some of Berkshire’s recent investments have been hotly debated, though it is far too soon to judge their ultimate outcome. The company’s book value (as well as our appraisal) incorporates the market price of Berkshire’s public equity stakes, which we believe are also selling for significant discounts to their intrinsic worth.We therefore are getting a double discount for a company that is financially and competitively advantaged, has a proven record of terrific insurance underwriting, owns a number of great brands in non-insurance businesses, and has two of the world’s best capital allocators at the helm.”

The Longleaf Partners Fund has been on a rebound last year after posting a return of -51% for 2008, its figures so far this year are impressive. It’s up 18% year-to-date through May 1 according to Morningstar.