|
The acquisition extends Buffett's push into the industrial
sector and eclipses Berkshire's $26.5 billion takeover of
Burlington Northern Santa Fe railroad in 2010.
"This takes us out of the market for an 'elephant' for 12 months
or so ... but we will be buying a few small things in the next
six months," Buffett said on CNBC.
Berkshire's offer of $235 per share is a premium of 21.2 percent
to Precision Castparts' Friday close of $193.88.
The shares were trading at $231.56 before the bell on Monday.
The deal has an equity value of about $32 billion based on the
Precision Castparts' shares outstanding as of June 28.
"In terms of price-earnings multiple going in, this is right
there at the top," Buffett said.
Berkshire was already one of Precision Castparts' largest
shareholders, with a stake of about 3 percent as of March 31,
according to regulatory filings.
Precision Castparts also makes energy-production equipment.
"When you get a chance to buy a wonderful company, there is
usually some reason why you are getting that chance and perhaps
a slump in oil and gas helps us in this case," Buffett said.
Global oil prices have more than halved since June last year.
Credit Suisse was financial adviser to Precision Castparts,
while Cravath, Swaine & Moore LLP and Stoel Rives LLP were legal
advisers. Berkshire Hathaway's legal counsel was Munger, Tolles
& Olson LLP.
(Reporting by Sagarika Jaisinghani and Sweta Singh in Bengaluru;
Editing by Savio D'Souza and Sriraj Kalluvila and Ted Kerr)
[© 2015 Thomson Reuters. All rights
reserved.] Copyright 2015 Reuters. All rights reserved. This material may not be published,
broadcast, rewritten or redistributed. |
|
