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  • Buffet Pays Nine Billion For Chemical Company – Some More Stocks To Watch 0 comments
    Jun 12, 2011 7:46 AM | about stocks: BRK.A, EMN, NEU, ALB, BCPC, WLK, IFF, DD

    Billionaire Warren Buffet overtakes the U.S. chemical company Lubrizol (LZ) for nine billion dollars - including the debt of 700 million dollars. The shareholders approved the offer.

    The majority of the shareholders of the U.S. chemical company Lubrizol voted on Thursday to adopt a nine billion dollars takeover offer from the major fund of billionaire Warren Buffett, Berkshire Hathaway. At the shareholder meeting, 95 percent of the issued shares of the company accepting the offer for an amount of 135 dollars per share, said the chemical company.

    With the company, Berkshire Hathaway also acquired debt in an amount of 700 million dollars, totaling the deal to 9.7 billion. Lubrizol makes chemicals for the pharmaceutical industry and fuel additives for gasoline and diesel as well as other chemical products. In the first quarter of the year, the company reported a net profit of 169.5 million dollars.

    Should the regulatory authority approve the takeover, the transaction could be completed until the end of the third quarter.

    Lubrizol was a specialized chemical company offside the attention of many value investors. As I heard from the deal, it was too late. I found a few interesting stocks from the same industry. Here are the results:

    Specialized Chemical Companies...

    The German based BASF Chemical Company (OTCQX:BASFY) is one of the biggest stocks within the major chemical industry and pays one of the highest dividends - 3.4 percent. Nevertheless, BASF is a cyclical company. Other stocks like IFF and BCPC are less volatile due to its business focus on the consumer industry (Foods and Fragrances). Stocks like E.I. Du Pont De Nemours (NYSE:DD) becoming more interesting due to its business diversification strategy (Geographic and Products). In January 2011, they bought the Danish Danisco, a world leader in food ingredients, enzymes and bio-based solutions.

     

    Related Ticker Symbols:
    LZ, BASFY, EMN, NEU, ALB, BCPC, WLK, IFF, DD

    Related Links:

    - The Essays of Warren Buffett: Lessons for Corporate America

    - Warren Buffett Portfolio: Mastering the Power of the Focus Investment

    - How to Think like Benjamin Graham and Invest like Warren Buffett

     

    Full Disclosure:

    I have no shares or obligations on the mentioned stocks, not intended to buy any stocks or obligations of the company within the next 72 hours. I don’t receive any compensation by the company.

    Themes: Warren Buffett, Chemicals Stocks: BRK.A, EMN, NEU, ALB, BCPC, WLK, IFF, DD
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