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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)
  • Kingkang
    , contributor
    Comments (137) | Send Message
     
    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
  • HackFab
    , contributor
    Comments (983) | Send Message
     
    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
  • J Mintzmyer
    , contributor
    Comments (3594) | Send Message
     
    Nice! Looking like a genius!
    14 Feb 2013, 08:14 AM Reply Like
  • HackFab
    , contributor
    Comments (983) | Send Message
     
    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
  • Contraria2
    , contributor
    Comments (354) | Send Message
     
    COP, VZ, GIS for starters
    14 Feb 2013, 09:30 AM Reply Like
  • HackFab
    , contributor
    Comments (983) | Send Message
     
    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
  • JohnBinTN
    , contributor
    Comments (3580) | Send Message
     
    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
  • Power Hedge
    , contributor
    Comments (966) | Send Message
     
    I believe TRV is also free...
    14 Feb 2013, 03:05 PM Reply Like
  • Chris DeMuth Jr.
    , contributor
    Comments (4032) | Send Message
     
    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
  • SA Editor Samir Patel
    , contributor
    Comments (163) | Send Message
     
    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
  • u01bsb0
    , contributor
    Comments (616) | Send Message
     
    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
  • J Mintzmyer
    , contributor
    Comments (3594) | Send Message
     
    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
  • dancing diva
    , contributor
    Comments (2405) | Send Message
     
    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
  • u01bsb0
    , contributor
    Comments (616) | Send Message
     
    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
  • jhooper
    , contributor
    Comments (5327) | Send Message
     
    Isn't our new Sec of State, Kerry, married to Heinz?
    14 Feb 2013, 08:23 AM Reply Like
  • jhooper
    , contributor
    Comments (5327) | Send Message
     
    I thought this was right.

     

    http://bit.ly/XOG6p7
    14 Feb 2013, 08:46 AM Reply Like
  • dancing diva
    , contributor
    Comments (2405) | Send Message
     
    Thanks, Warren. This is by far the best Valentines day gift I've ever received!
    14 Feb 2013, 08:23 AM Reply Like
  • claimsguy
    , contributor
    Comments (2) | Send Message
     
    Interesting Buffet is doing this with a partner. Will be interesting to see new ownership structure
    14 Feb 2013, 08:34 AM Reply Like
  • Maxim Shtraus
    , contributor
    Comments (11) | Send Message
     
    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
  • Nick Dorset
    , contributor
    Comments (80) | Send Message
     
    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
  • angelodebo
    , contributor
    Comments (31) | Send Message
     
    Does anyone find it odd that Godman recently downgraded this stock? Seems a little strange.
    14 Feb 2013, 10:56 AM Reply Like
  • itsAme
    , contributor
    Comments (99) | Send Message
     
    why? they weren't part of the deal team and their research and conclusion made sense.
    14 Feb 2013, 11:42 AM Reply Like
  • angelodebo
    , contributor
    Comments (31) | Send Message
     
    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
  • Maxim Shtraus
    , contributor
    Comments (11) | Send Message
     
    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
  • abner2
    , contributor
    Comments (2) | Send Message
     
    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
  • abner2
    , contributor
    Comments (2) | Send Message
     
    Should have said, "....know this will be a 'tasty' topic."

     

    abner2
    14 Feb 2013, 02:43 PM Reply Like
  • JKapolka
    , contributor
    Comment (1) | Send Message
     
    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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