Warren Buffett put together the biggest deal in his 44-year career at Berkshire Hathaway Inc. in 10 days.
Buffett, Berkshire's chairman, was in Fort Worth, Texas, on Oct. 22 for a company board meeting. The next day, he invited Matthew Rose, chief executive officer of Burlington Northern Santa Fe Corp., to meet him at the Ashton Hotel, a 1915 city landmark.
“It was a relatively short conversation,” Rose told Bloomberg Television on Tuesday. “He told me what he wanted to do and the next day we fired up the process.”
The deal Buffett unveiled to Rose was $100 a share for the 77.4 percent of Burlington not already owned by Omaha, Neb.-based Berkshire, and Rose said he would take it to his board, according to a person familiar with the matter who spoke on condition of anonymity because the talks were private.
Over the weekend, Rose hired his longtime financial adviser, Goldman Sachs Group Inc., to analyze the bid. Goldman's team included bankers Marc Nachmann and Dusty Philip. Rose also added George Ackert and Roger Altman of Evercore Partners Inc., a New York-based boutique.
Part of the reason Burlington's board wanted Evercore as a second adviser was that Berkshire owns a $5 billion stake in Goldman Sachs, said the person with knowledge of the situation.
Buffett, Rose and their advisers spent the next week working out the deal. Burlington's board approved the sale Monday in Detroit, because lead director Edward Whitacre, who is chairman of General Motors Co., needed to be there for a GM board meeting, the person said. Berkshire's board approved the deal Monday night, and Buffett announced it Tuesday.
Buffett didn't return a message left with his assistant Carrie Kizer.
Berkshire will pay $26 billion, or $100 in cash and stock. Including Buffett's previous investment and the assumption of debt, the deal's value is about $44 billion, Berkshire said in a statement.
Berkshire didn't disclose using any financial advisers on the transaction. Buffett turned to his longtime outside lawyer, Robert Denham of Los Angeles firm Munger, Tolles & Olson, for legal advice, and Burlington used a team from New York-based Cravath Swaine & Moore, including Scott Barshay, George Zobitz and Damien Zoubek.
