Warren Buffett’s Berkshire Hathaway agrees to buy insurance company Alleghany for $11.6 billion

Warren Buffett is taking steps.

Berkshire Hathaway On Monday morning, it said it had agreed to buy Richie’s insurance company for $11.6 billion, or $848.02 per share in cash. The Omaha, Nebraska-based group said the deal “represents a multiple of 1.26 times the book value of the Ghanaian on December 31, 2021,” as well as a 16% premium over the average share price of the Ghanaian in the past 30 days. The deal is expected to close in the last quarter of this year.

Through its affiliates, headquartered in New York the rich It is involved in a number of different insurance companies, including the wholesaling specialty, property and loss, and reinsurance.

“Berkshire would be the perfect permanent home for Alleghany, a company I’ve been watching closely for 60 years,” BuffettChairman and CEO of Berkshire Corporation, in a statement.

Joseph Brandon, CEO of Al Ghani Corporation – who previously led a Berkshire-owned General Company – hailed the deal as “a fantastic deal for Al Ghani’s owners, companies, customers and employees,” noting that “the value of this transaction reflects the quality of our franchises and is the product of the hard work, perseverance and determination of the Ghanaian team to over decades.”

Al Afghani and its units will operate independently after the deal closes.

The deal may surprise some Berkshire shareholders, such as Buffett and his right-hand man – vice chairman Charlie Munger They expressed frustration in their search for a major acquisition. In his 2022 annual letter to shareholders, Buffett said he found her and Munger Little that “excites” them in terms of big acquisitions.

To be sure, $11.6 billion is a small number compared to Berkshire’s massive cash stock of $146.72 billion at the end of 2021.

Adam Crisavoli of Vital Knowledge said in a note.

The Ghanaian is notified by Goldman Sachs and Willkie Farr & Gallagher that the deal has been completed.

Monday’s deal comes after Berkshire’s top-tier shares hit a record high last week, Close above $500,000 for the first time.