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Warren Buffett's Berkshire Hathaway is buying Heinz ketchup company

February 14, 2013|by Walter Hamilton
  • The $28 billion, including the assumption of debt, that Berkshire Hathaway is paying for the Heinz ketchup company is the biggest buyout in the history of the food industry.
The $28 billion, including the assumption of debt, that Berkshire Hathaway… (Toby Talbot / Associated…)

Warren Buffett has been very publicly casting about for a big deal – and he's found one in the Heinz ketchup company.

Through his investment firm, Berkshire Hathaway, the famed investor is teaming up with a Brazilian private-equity firm to acquire H.J. Heinz. The $28-billion price tag, including the assumption of debt, is the biggest buyout in the history of the food industry.

Heinz shareholders will get $72.50 a share in cash, a 20% premium to the ketchup maker’s $60.48 closing price Wednesday.

“Heinz has strong, sustainable growth potential based on high-quality standards, continuous innovation, excellent management and great tasting products,” Buffett said in a statement.

Heinz will maintain its headquarters in Pittsburgh. Buffett’s partner in the deal, 3G Capital, made a name for itself by investing in Burger King.

Heinz shares were recently trading at $72.50, but went as high as $72.61 earlier this morning, suggesting some investors may be expecting a potential rival bid to emerge.

Buffett has vocally complained recently about a lack of investment opportunities and took the unusual step of buying back some of Berkshire’s stock with some of the company’s huge stockpile of cash.

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Follow Walter Hamilton on Twitter @LATwalter

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