OMAHA, Neb., & PORTLAND, Ore. (Aug. 10, 2015) – The boards of directors of Berkshire Hathaway Inc. and Precision Castparts Corp. (PCC) have unanimously approved a definitive agreement for Berkshire Hathaway to acquire, for $235 per share in cash, all outstanding PCC shares. The transaction is valued at approximately $37.2 billion, including outstanding PCC net debt.
“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 Warren E. Buffett, Berkshire Hathaway chairman and CEO.
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 CEO. “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. This transaction offers compelling and immediate value for our shareholders and allows PCC’s employees to continue to operate in the same manner that has generated many years of exceptional service and performance to our customers.”
In light of this announcement, the three nominees who would have joined PCC’s Board of Directors if elected at PCC’s upcoming Annual Meeting of Shareholders—Peter B. Delaney, James F. Palmer and Janet C. Wolfenbarger—have withdrawn their candidacy. None of Delaney, Palmer or Wolfenbarger currently serves on PCC’s Board of Directors, and PCC does not intend to nominate replacement directors for election at the Annual Meeting in their place. Other than Delaney, Palmer and Wolfenbarger, the nominees named in the Proxy Statement sent or made available to PCC shareholders, all of whom currently serve on PCC’s Board of Directors, intend to stand for election at the Annual Meeting.
Credit Suisse acted as financial adviser to PCC, and PCC’s legal counsel is Cravath, Swaine & Moore LLP and Stoel Rives LLP. Berkshire Hathaway’s legal counsel is Munger, Tolles & Olson LLP.
Berkshire Hathaway and its subsidiaries engage in diverse business activities including insurance and reinsurance, utilities and energy, freight rail transportation, finance, manufacturing, retailing and services.
Precision Castparts Corp. is a worldwide, diversified manufacturer of complex metal components and products.