It is nice to know that amid the turmoil of the past year, there is at least one constant: Warren Buffett doesn't like private-equity firms.

Buffett already was nursing ill-feeling for private equity, famously once comparing private-equity investors to "porn shop operators."

Getty ImagesAnd that was before private equity faced off against Mr. Buffett's MidAmerican Energy Holdings' proposed-and eventually rejected-$4.7 billion offer to buy Baltimore's Constellation Energy. In September, MidAmerican, a unit of Berkshire Hathaway, was bidding against Electricite de France, then working with two private-equity firms, Kohlberg Kravis Roberts and TPG. TPG eventually stepped out. In December, a solo EdF agreed to buy half of Constellation's nuclear business for $4.5 billion.

That brings us to Buffett's closely watched annual report, out Saturday, which including a bit of a dressing down for the private-equity business. First, he dismissed private-equity firms for their "Orwellian" name change to the more upscale "private equity firms" from mere leveraged buyout shops. Then he attacked the LBO model: "A purchase of a business by these firms almost invariably results in dramatic reductions in the equity portion of the acquiree's capital structure compared to that previously existing. A number of these acquirees, purchased only two to three years ago, are now in mortal danger because of the debt piled on them by their private-equity buyers.

"We have a decided advantage, therefore, when we encounter sellers who truly care about the future of their businesses," Buffett said.