Berkshire Hathaway Inc. for the acquisition of Burlington Northern Santa Fe Corporation (BNSF) for $ 100 per share in cash and stock
“The future prosperity of our country depends on its having an effective and well-maintained rail system,” said Warren E. Buffett, Berkshire Hathaway Chairman and CEO. “Conversely, America must grow and prosper for railroads to do well. Berkshire investing $ 34 billion in BNSF is a huge bet on this company, CEO Matt Rose and his team, and the railway industry.
“The most important of all, however, is an all-in bet on the economic future of the United States,” said Mr. Buffett. “I love those paris.”
“We are delighted to have the opportunity to become part of the Berkshire Hathaway family,” said Matthew K. Rose, chairman of Burlington Northern Santa Fe, president and CEO. “We admire the leadership philosophy Warren support long-term investment that will allow BNSF to focus on the future needs of our rail, our customers and the transportation infrastructure of the United States. This transaction provides compelling value for our shareholders and is in the best interest of all our constituents, including our customers and our employees. ”
Terms of the transaction
The definitive agreement provides that each share of BNI shares will be chosen by the shareholder, be converted into the right to receive either (i) a cash payment of $ 100.00 or (ii) a variable number of shares Berkshire Hathaway Class A or Class B common stock, subject to proration if the elections are not equal to about 60 percent cash and 40 percent in stock. The equity component of the consideration is subject to a “collar” by which the value of each share in Berkshire Hathaway is set to receive $ 100.00 if the price of Berkshire Hathaway Class A stock at the closing is between about 80,000.00 $ and approximately $ 125,000.00 per share. If the value of Berkshire Hathaway Class A stock is outside this range collar closure, then the number of shares received a Berkshire Hathaway Class A shares will be set at 0.001253489, either by action for BNI values below the collar beach, or 0.000802233 per share BNI, for values above the collar line. A shareholder may receive a Class A or, in lieu of fractional shares of Class A, the economic equivalent of Class B shares of Berkshire Hathaway, subject to certain limitations as described in the agreement.
The transaction requires approval by holders of two thirds of the outstanding shares of BNI (other than shares held by Berkshire Hathaway), and customary closing conditions, including the Department of Justice review. The closing should occur during the first quarter of 2010.
BNSF Railway Company will continue to focus on providing outstanding service to its customers from its headquarters in Fort Worth TX. Included in the transaction are all assets and subsidiaries of BNSF.
Goldman, Sachs & Co. and Evercore Partners Inc. acted as financial advisors to BNSF and counsel for the firm is Cravath Swaine & Moore LLP. Counsel for Berkshire Hathaway transaction is Munger, Tolles & Olson LLP.
At 8:30 Eastern, BNSF Management will conduct a briefing for investors and other interested parties. The meeting will be Web cast and available via the Investor Relations www.bnsf.com. The telephone call is (800) 398-9367 and the replay number is (USA) (800) 475-6701 (International) (320) 365-3844 and the access code 122409. The meeting will not include a session of questions and answers.
BNSF is a holding company and through its principal operating subsidiary, BNSF Railway Company, BNSF owns and operates one rail systems most extensive in North America.
Berkshire Hathaway Inc. is a holding company owning subsidiaries engaged in a number of diverse activities including property and casualty insurance and reinsurance, utilities and energy, manufacturing, retailing and services.
Forward-Looking Statements
The statements contained herein regarding expectations or projections of financial performance or operational or economic opportunities, or for other events or future results, or which refer to matters that are not historical facts are “forward-looking “within the meaning of Federal securities. Similarly, statements that describe our expectations or goals BNSF Berkshire Hathaway, plans or goals are forward-looking statements. Forward-looking statements include, without limitation, BNSF or expectations of Berkshire Hathaway’s on the marketability of their businesses, productivity, plans and objectives for future operational improvements and capital investments, operational performance the future market conditions and economic performance and developments in the capital and credit markets and its future financial performance. Forward-looking statements also include statements regarding expected benefits of the proposed acquisition of BNSF by Berkshire Hathaway. Forward-looking statements involve a number of risks and uncertainties, and actual results or events May differ materially from those projected or implied in these statements.
Important factors that could cause such differences include, without limitation: adverse changes in the volatility of economic conditions or industry, both in the United States and around the world, continuing in the capital or credit markets and other changes in securities and financial markets, changes in customers or suppliers, competition and consolidation in areas where BNSF and Berkshire Hathaway competition, costs of labor and difficulties of work, developments and changes in laws and regulations, changes and losses arising from claims and litigation, natural events such as storms, fires, floods and earthquakes or acts terrorism, changes in operating conditions and costs and the extent of BNSF, or the ability of Berkshire Hathaway initiatives to achieve their operational and financial objectives and business. In addition, BNSF acquired by Berkshire Hathaway is subject to the satisfaction of the conditions necessary for the completion of the acquisition and the absence of events that could lead to termination of the merger agreement for the acquisition, and the possibility that the acquisition does not close, and the risks that the proposed acquisition disrupts current plans and operations and business relationships, or poses difficulties in employee retention.
We caution against placing undue reliance on forward-looking statements, which reflect our current views and are based on information currently available to us as of the date a forward-looking statement is made. We undertake no obligation to revise forward-looking statements to reflect future events, changed circumstances or changes in beliefs. Where we update any forward-looking statements, no inference should be made that we will make additional updates with respect to that statement, related matters, or any other forward-looking statements. Any corrections or revisions and other important factors and assumptions that could cause actual results to differ materially from our forward-looking statements, including a discussion of important risk factors, may appear in BNSF or public filings with Berkshire Hathaway the Securities and Exchange Commission ( “SEC”), which are available at www.sec.gov, and you are advised to consult.
Additional Information
Under the proposed transaction, Berkshire Hathaway will file with the SEC a registration statement that contains a proxy statement of BNSF, which also constitutes a prospectus of Berkshire Hathaway on the proposed transaction. Investors are urged to read the registration statement and proxy statement / prospectus and other relevant documents filed with the SEC when they become available because they contain important information on BNSF, Berkshire Hathaway and the proposed transaction. The registration statement and proxy statement / prospectus and other documents concerning the proposed transaction (when available) can be obtained free on the website of the SEC at www.sec.gov website on Berkshire Hathaway www.berkshirehathaway.com and BNSF Web site at www. bnsf.com. In addition, these documents (when available) can also be obtained free of charge from Berkshire Hathaway written request to Corporate Secretary or by phone at (402) 346-1400, or from BNSF, upon written request to Linda Hurt or John Ambler or by calling (817) 352-6452 or (817) 867-6407.
BNSF, Berkshire Hathaway and certain of its directors and officers may be deemed participants in the solicitation of proxies from shareholders in connection with the proposed transaction under SEC rules. Information about the directors and officers of BNSF May be found in its 2008 annual report on Form 10-K filed with the SEC February 13, 2009 and its definitive proxy statement relating to its 2009 Annual Meeting of Shareholders filed with the SEC on March 16, 2009. Information about the directors and executives of Berkshire Hathaway in May is found in its 2008 annual report on Form 10-K filed with the SEC March 2, 2009 and its definitive proxy statement relating to its 2009 Annual Meeting of Shareholders filed with the SEC March 13, 2009. These documents may be obtained free of charge from the sources indicated above. Additional information regarding interests of such participants will be also included in the registration statement and proxy statement / prospectus regarding the proposed transaction when it is filed with the SEC.
Posted: November 3rd, 2009 under Market News, Stock Market News.