PhillyTablet Inquirer Daily News
Mobile
Home Delivery
philly.com
email
font size
comments
0
options
 
Tuesday, November 3, 2009

Warren Buffett's biggest bet: Railroad worth $44B, as oil rises

Billionaire Warren Buffett's Berkshire Hathaway Corp., an insurance and manufacturing conglomerate based in Omaha, is taking over Burlington Northern Santa Fe Corp. which ties Chicago, Houston and the whole West by rail.

It's a bet that U.S. shipping will recover - and that oil prices will rise, since rail transport is way cheaper than trucks.

"It's an all-in wager on the economic future of the United States," Buffett said in this statement. "I love these bets."

Updated: Deal includes $26 billion ($100/share) cash, plus assumption of BNSF debt. With existing Buffett holdings, values the railroad at $44 billion, or $100/share, vs recent $76/share trading price, says Bloomberg here.
Posted by Joseph N. DiStefano @ 9:33 AM  Permalink | Post a comment
Comments   


0 comments
About Joseph N. DiStefano
Joseph N. DiStefano writes this blog to feed his PhillyDeals column in the Philadelphia Inquirer. Joe has been a member of Bloomberg LP’s New York Finance Team, wrote the book “Comcasted,” taught writing at St. Joseph’s University, and studied economics and history at Penn. Reach Joe at 215-854-5194 and JoeD@phillynews.com
Advertise Here