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Buffett in railroad buy-out deal | Buffett in railroad buy-out deal |
(about 4 hours later) | |
Billionaire Warren Buffett's investment firm is to take control of the second-biggest US railroad, in what is said to be his biggest deal yet. | Billionaire Warren Buffett's investment firm is to take control of the second-biggest US railroad, in what is said to be his biggest deal yet. |
Berkshire Hathaway agreed to buy the 77.4% of Burlington Northern Santa Fe (BNSF) it does not already own for about $26bn (£16bn) in cash and stock. | Berkshire Hathaway agreed to buy the 77.4% of Burlington Northern Santa Fe (BNSF) it does not already own for about $26bn (£16bn) in cash and stock. |
BNSF is the biggest US haulier of products such as corn and coal. | BNSF is the biggest US haulier of products such as corn and coal. |
Mr Buffett said that the deal was "an all-in wager on the economic future of the United States". | Mr Buffett said that the deal was "an all-in wager on the economic future of the United States". |
"I love these bets," he added. | "I love these bets," he added. |
Ships goods | |
Including past investment and the assumption of $10bn of BNSF debt, the deal is valued at $44bn. | Including past investment and the assumption of $10bn of BNSF debt, the deal is valued at $44bn. |
The railroad also ships goods from western US ports including refrigerators, clothing and TVs. | The railroad also ships goods from western US ports including refrigerators, clothing and TVs. |
Berkshire Hathaway already owns about 22% of BNSF and said it will pay $100 a share for the rest of the company. | Berkshire Hathaway already owns about 22% of BNSF and said it will pay $100 a share for the rest of the company. |
The deal has been approved by the boards of both companies, but still needs backing from two-thirds of BNSF's shareholders. | The deal has been approved by the boards of both companies, but still needs backing from two-thirds of BNSF's shareholders. |
The railroad expects to clear those hurdles in the first three months of next year. | The railroad expects to clear those hurdles in the first three months of next year. |
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