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Berkshire Hathaway (BRK.A) to buy H. J. Heinz Company (HNZ) for $72.50/share, or $28B. Shares...

Berkshire Hathaway (BRK.A) to buy H. J. Heinz Company (HNZ) for $72.50/share, or $28B. Shares +20.2% premarket to $72.70. Update: Confirmed.
Comments (27)
  • I always knew that HEINZ would be a great choice. It has great brand awareness and metrics. I mean c'mon, what other ketchup do you put on your fries, cheesesteaks, burgers, etc. Yup!
    14 Feb 2013, 07:55 AM Reply Like
  • I just opened a HNZ DRIP account for my grandson last week. He's got 5 shares.
    14 Feb 2013, 07:59 AM Reply Like
  • Nice! Looking like a genius!
    14 Feb 2013, 08:14 AM Reply Like
  • Yeah, except now I need to find another good company with a no cost DRIP to invest in.
    14 Feb 2013, 09:27 AM Reply Like
  • COP, VZ, GIS for starters
    14 Feb 2013, 09:30 AM Reply Like
  • He's already got COP. And NSC, GE, HAS, SNH, K, and JNJ.

     

    I would go with GIS, as there are no fees, but he already has K. VZ charges fees on their DRIP. I may look into CAG or HRL.
    14 Feb 2013, 09:44 AM Reply Like
  • Some other good (have been for me, at any rate) no-fee DRIP plans - LMT, XOM, NEE, MAC, DUK
    14 Feb 2013, 10:05 AM Reply Like
  • I believe TRV is also free...
    14 Feb 2013, 03:05 PM Reply Like
  • Terrific deal. As with many BRK.b deals, this will be a shareholder vote as shareholders will assume that Buffett is only doing this if it is a great bargain. In the case of target shareholder votes, his deservedly great reputation is a bit of a catch-22.
    14 Feb 2013, 08:02 AM Reply Like
  • Chris, any quick thoughts on the valuation - is Berkshire really getting a terrific "deal" or is this a bit of a stretch? I haven't been following HNZ closely but my from-afar impression was that it (and peers) were already at robust-to-pricey valuations.
    14 Feb 2013, 09:23 AM Reply Like
  • it does all add up. BRK was going to make a big acquisition. This has a steady income, a strong moat and strong brand too.
    14 Feb 2013, 08:14 AM Reply Like
  • I'm not really sure if this is a net positive for BRK-B... Seems a little expensive?
    14 Feb 2013, 08:15 AM Reply Like
  • That's what they always say about Buffett's buys. What's underappreciated by the market is that Heinz is huge and growing tremendously outside the US. They are much more than a ketchup company, having made many foreign acquisitions over the past several years. Baby food, seasonings, other sauces etc. I was thinking of adding to my position yesterday on the downgrade, but with earnings next week I thought I'd wait. You could have bought the March $60 call all day for about $1.30 - today it will be worth about 10 times as much. As much as I'm thrilled with the purchase price I'm also kicking myself.
    14 Feb 2013, 08:30 AM Reply Like
  • yea furthermore, the more food chains such as macdonalds expand the better for the likes of heinz as macdonalds pay heinz a great deal for the ketchup
    14 Feb 2013, 09:13 AM Reply Like
  • Isn't our new Sec of State, Kerry, married to Heinz?
    14 Feb 2013, 08:23 AM Reply Like
  • I thought this was right.

     

    http://bit.ly/XOG6p7
    14 Feb 2013, 08:46 AM Reply Like
  • Thanks, Warren. This is by far the best Valentines day gift I've ever received!
    14 Feb 2013, 08:23 AM Reply Like
  • Interesting Buffet is doing this with a partner. Will be interesting to see new ownership structure
    14 Feb 2013, 08:34 AM Reply Like
  • Makes no sense if you ask me. Buffet likes to keep his companies and stocks forever. 3G Capital will need to repay investors in about 5-6 years. They will probably end up buying the rest of the company from 3G for a further premium in a few years.
    14 Feb 2013, 11:19 AM Reply Like
  • I agree with Dancing Diva not everybody thought the Burlington purchase was good value - but amongst other things because of shale oil & gas, this is turning out to be a great strategic purchase, and so cheap.
    14 Feb 2013, 08:49 AM Reply Like
  • Does anyone find it odd that Godman recently downgraded this stock? Seems a little strange.
    14 Feb 2013, 10:56 AM Reply Like
  • why? they weren't part of the deal team and their research and conclusion made sense.
    14 Feb 2013, 11:42 AM Reply Like
  • Does anyone find it odd that Goldman recently downgraded this stock to a sell? Seems a little strange.
    14 Feb 2013, 10:57 AM Reply Like
  • For the life of me I don't understand this deal! First of all, why pay a 20% premium for a consumer goods company? Second, why buy an economically defensive company in the early part of the cycle? Third, why partner with a private equity firm? Berkshire likes to keep the companies they buy for a long time. 3G Capital will need to repay investors in about 5-6 years so they will probably end up selling their stake to Berkshire for a further premium. Don't get me wrong, Heinz is a great company, I just don't think it made sense to buy it up here at this point in time.

     

    Warren should have bought another Industrial.
    14 Feb 2013, 11:18 AM Reply Like
  • Have been a consumer of Heinz products for the better part of seven decades....always look at the "packets" of catsup in fast food joints...MUST be Heinz!!!! I'm a great fan of and beliver in Mr. Buffett...looking forward to Omaha, again, in a few weeks...know this will be a lively topic.
    abner2
    14 Feb 2013, 12:15 PM Reply Like
  • Should have said, "....know this will be a 'tasty' topic."

     

    abner2
    14 Feb 2013, 02:43 PM Reply Like
  • Better to buy a great company at a fair price than a fair company at a great price. Classic Buffett
    14 Feb 2013, 05:58 PM Reply Like
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