Berkshire to buy Precision Castparts for 37.2 bln USD
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E-mail Xinhua, August 11, 2015
U.S. billionaire investor Warren Buffett's Berkshire Hathaway said Monday that its board of directors has agreed to acquire aerospace supplier Precision Castparts Corp ("PCC") for about 37.2 billion U.S. dollars in cash, which would be the conglomerate's largest takeover ever.
Shares of Precision Castparts surged over 19 percent to 231.09 apiece in morning trading on Monday. U.S stocks jumped in the morning session, with the Dow looking to break a seven-day losing streak, as the deal showed the M&A boom was alive and well.
"I've admired PCC's operation for a long time. For good reasons, it is the supplier of choice for the world's aerospace industry, one of the largest sources of American exports. Berkshire's Board of Directors is proud that PCC will be joining Berkshire," said Buffet, chairman and chief executive officer of Berkshire Hathaway.
The transaction requires approval by a majority of PCC's outstanding shares. Closing is expected to occur during the first quarter of calendar 2016, subject to customary closing conditions, including clearance under the Hart-Scott-Rodino Act and competition clearance in certain foreign jurisdictions.
PCC will continue to do business around the world under the Precision Castparts name and maintain its headquarters in Portland, Oregon.
"We are very pleased to be joining forces with Berkshire Hathaway," said Mark Donegan, PCC's chairman and chief executive officer. "We see a unique alignment between Warren's management and investment philosophy and how we manage PCC for the long-term. "
"We believe that as part of Berkshire Hathaway, PCC will be exceptionally well-positioned to support our customers' needs into the future," Donegan added.
Precision Castparts supplies parts such as fasteners and turbine blades to aircraft makers, and it makes pipes and other equipment for power stations and the oil-and-gas industry. Endite
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