INDUSTRY news


Berkshire Hathaway to Buy Precision Castparts for $37.2B On Aug. 10, Berkshire Hath-


away, Omaha, Neb., announced a deal to acquire Precision Castparts Corp., Portland, Ore., for $37.2 billion, in what is the biggest deal ever for Warren Buffett’s firm. “This takes us out of the


market for an elephant for 12 months or so ... but we will be buying a few small things in the next six months,” Buffett told CNBC. Berkshire offered $235 per


share, a 21.2% premium for the aerospace casting giant’s previous Friday closing price of $193.88. The company’s shares were trading at $230.85 before the market opened on Monday, Aug. 10. With a stake of roughly 3%,


Berkshire was already one of Pre-


cision Castparts’ largest share- holders, according to regulatory fi lings from earlier this year. Precision Castparts secures about 70% of its sales from the aero- space industry, which has seen demand for commercial aircraft increase in recent months. “When you get a chance to


buy a wonderful company, there is usually some reason why you are getting that chance and perhaps a slump in oil and gas helps us in this case,” Buff ett said. Buffett expects Berkshire to use about $23 billion of its own cash and borrow the remaining $14.2 billion to finance the deal. “We will have about $40


The deal was the largest in Buffett’s Berkshire Hathaway’s history.


billion in cash once we get through this,” Buffett said. “I like to have a lot of cash at all times.” ■


Sept/Oct 2015 | METAL CASTING DESIGN & PURCHASING | 7


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