View Full Version : Warren Buffet goes "all in"...
UPDATE 3-Warren Buffett buying railroad Burlington Northern
Tue Nov 3, 2009 9:24am EST
Email | Print | Share | Reprints | Single Page
[-] Text [+]
More News
US STOCKS SNAPSHOT-Futures cut losses on Berkshire-Burlington
7:44am EST
* Deal is Buffett's biggest ever
* Buffett calls it a bet on the U.S. economy
* Price of $100/share is a premium of 31.5 percent
* Deal values railroad at $34 billion
* Buffett already owns 22.6 pct of railroad's shares (Adds further Buffett quotes, Berkshire stock split, deal details, comment, byline)
By Nick Zieminski
NEW YORK, Nov 3 (Reuters) - Warren Buffett's Berkshire Hathaway Inc (BRKa.N) (BRKb.N) will pay $26 billion to buy out railroad Burlington Northern Santa Fe Corp (BNI.N) in what the billionaire investor called a bet on the U.S. economy.
The deal, Buffett's biggest-ever acquisition, is priced at a premium of 31.5 percent over BNSF's closing stock price on Monday and values the railroad at $34 billion.
"It's an all-in wager on the economic future of the United States," Buffett said in a statement, adding that railroads are key to the U.S. economy and will benefit as recovery takes hold. "I love these bets."
Berkshire Hathaway will pay $100 per share in cash and stock for the 77.4 percent of BNSF shares it does not already own. Berkshire will also assume $10 billion of BNSF debt. The deal is expected to close in the first quarter of 2010.
Shares of railroad companies rallied in premarket trading following news of the deal, and stock index futures pared losses.
"For the market, it can be seen as a sign of confidence (about the economy)," said Peter Boockvar, equity strategist at Miller Tabak + Co in New York, adding it was logical for Buffett to buy the rest of the railroad.
"Berkshire is seeing way past some impending economic recovery signs now and looking into the future," he said.
BNSF shares were up 29 percent to $98.18 in premarket trading.
Berkshire's board approved a 50-for-1 split of the company's Class B common stock to help ease the way for the deal.
UPDATE 3-Warren Buffett buying railroad Burlington Northern
Tue Nov 3, 2009 9:24am EST
Email | Print | Share | Reprints | Single Page
[-] Text [+]
More News
US STOCKS SNAPSHOT-Futures cut losses on Berkshire-Burlington
7:44am EST
* Deal is Buffett's biggest ever
* Buffett calls it a bet on the U.S. economy
* Price of $100/share is a premium of 31.5 percent
* Deal values railroad at $34 billion
* Buffett already owns 22.6 pct of railroad's shares (Adds further Buffett quotes, Berkshire stock split, deal details, comment, byline)
By Nick Zieminski
NEW YORK, Nov 3 (Reuters) - Warren Buffett's Berkshire Hathaway Inc (BRKa.N) (BRKb.N) will pay $26 billion to buy out railroad Burlington Northern Santa Fe Corp (BNI.N) in what the billionaire investor called a bet on the U.S. economy.
The deal, Buffett's biggest-ever acquisition, is priced at a premium of 31.5 percent over BNSF's closing stock price on Monday and values the railroad at $34 billion.
"It's an all-in wager on the economic future of the United States," Buffett said in a statement, adding that railroads are key to the U.S. economy and will benefit as recovery takes hold. "I love these bets."
Berkshire Hathaway will pay $100 per share in cash and stock for the 77.4 percent of BNSF shares it does not already own. Berkshire will also assume $10 billion of BNSF debt. The deal is expected to close in the first quarter of 2010.
Shares of railroad companies rallied in premarket trading following news of the deal, and stock index futures pared losses.
"For the market, it can be seen as a sign of confidence (about the economy)," said Peter Boockvar, equity strategist at Miller Tabak + Co in New York, adding it was logical for Buffett to buy the rest of the railroad.
"Berkshire is seeing way past some impending economic recovery signs now and looking into the future," he said.
BNSF shares were up 29 percent to $98.18 in premarket trading.
Berkshire's board approved a 50-for-1 split of the company's Class B common stock to help ease the way for the deal.
Unfortunately it could be an insider bet (he's tight with Obama) on cap and trade legislation. Cap and trade will kill economic growth but could be a boon for rail. Rail is favorable in emissions and fuel efficiency versus trucks. Rail is slow and cumbersome but would do great under cap and trade laws which could send gas and diesel prices skyrocketing. Tha administration says $.20 per gallon but other analysts say it may be $1.50 to $3.00 per gallon over time- which would kill the truckers to the benefit of rail.
I sure hope this is a bet on the economy ............. but
UpnorthGo4
11-03-2009, 08:32 AM
Railroads - 19th Century technology for the 21st Century. Take it to the bank. Has anyone ever lost money betting on Warren Buffet's vision for the future?
China's green technology market to attract huge investment: Report
September 11, 2009
The China Greentech Report 2009, released Thursday in north China's coastal city Dalian, said China's green technology market would attract more investment and estimated a market with a potential value up to one trillion U.S. dollars annually.
The report, jointly issued by the PricewaterhouseCoopers and American Chamber of Commerce in Shanghai at the 2009 Summer Davos, estimated the size of China's green technology market could be between 500 billion U.S. dollars and one trillion U.S. dollars annually, or as much as 15 percent of China's forecasted GDP, in 2013.
It examines market opportunities in seven sectors, including cleaner conventional energy, renewable energy, electric power infrastructure and green building.
The Chinese government's policies were positive drivers for green technology market development and a wide range of businesses were beginning to develop green technology solutions to address a broad spectrum of environmental issues, it said.
Although the opportunities in China's green technology market were attractive, market, technology, financing and regulatory challenges remained to be overcome, it said.
The three-day summit, also known as the Annual Meeting of New Champions 2009 under the World Economic Forum, attracted about 1,400 business leaders and policy makers from 86 countries and regions.
last week beej makes thinly veiled comparisons between O and hitler and now he makes thinly veiled thoughts that the president of the us and the worlds most famous investor have entered into an insider trading transaction. you are so radical its not even funny. either that or you are just a jokester having fun with this all at the expense of your gh reputation, as no rational person makes these types of comments without delusion or humor.
" Rail is slow and cumbersome"
You have a lot to learn about railroads.
monk10
11-03-2009, 09:31 AM
I thought truckers turned to propane when the gas prices went up. Haven't they been testing this theory since like 2000? I'm not into energy markets as much as others, but I wouldn't imagine that gas prices are going to affect in industry already moving away from them.
jamiche
11-03-2009, 09:34 AM
last week beej makes thinly veiled comparisons between O and hitler and now he makes thinly veiled thoughts that the president of the us and the worlds most famous investor have entered into an insider trading transaction. you are so radical its not even funny. either that or you are just a jokester having fun with this all at the expense of your gh reputation, as no rational person makes these types of comments without delusion or humor.
Buffett doing an insider trading deal with Obama. Good stuff.
last week beej makes thinly veiled comparisons between O and hitler and now he makes thinly veiled thoughts that the president of the us and the worlds most famous investor have entered into an insider trading transaction. you are so radical its not even funny. either that or you are just a jokester having fun with this all at the expense of your gh reputation, as no rational person makes these types of comments without delusion or humor.
I'm not making inside trade accusations, ding dong. I'm just saying that Buffett knows Obama and certainly has had talks wiht him about the cap and trade scenarios. Guys like Buffett figure out how to utilize the laws of the land to their advantage whether or not they like the laws or not.
But in your world - yes I'm radical and happy to be so.
Cap and trade would not seem to be favorable to an industry like coal and yet Buffet is...
BETTING ON THE FUTURE OF COAL
Jack Ablin, chief investment officer at Harris Private Bank in Chicago, said the deal was a bet on the future of coal as a source of energy.
"Because Burlington Northern moves coal around the country, I think Buffett is trying to get into coal but doing it in a cheaper way," he said. "It's leveraged against coal's demand without actually having to buy the commodity itself."
Some analysts said the deal did not necessarily signal a wave of mergers and acquisitions in railroads.
"For an outsider to make an acquisition of a railroad or invest a significant amount in a railroad -- you may see more people get interested in that possibility," said George Van Horn, senior analyst with market research firm IBISWorld.
"But as far as seeing railroad themselves merging, I wouldn't expect that right away," he said.
Berkshire said the 50-for-1 split of its Class B shares, which is subject to shareholder approval, would make it easier for smaller BNSF shareholders to swap their stock for Berkshire stock. Class B shares were up 1.5 percent to $3,313.50 in early trading.
Buffett, one of the world's richest men and one of its most revered investors, is known for making big long-term bets. He wrote in The New York Times in October 2008 that he had been buying American stocks in his personal account, a few weeks after the collapse of Lehman Brothers set off worldwide selling.
"Fears regarding the long-term prosperity of the nation's many sound companies make no sense," Buffett wrote at the time.
jamiche
11-03-2009, 10:18 AM
I'm not making inside trade accusations, ding dong. I'm just saying that Buffett knows Obama and certainly has had talks wiht him about the cap and trade scenarios. Guys like Buffett figure out how to utilize the laws of the land to their advantage whether or not they like the laws or not.
But in your world - yes I'm radical and happy to be so.
Ah yes. The old non accusation, accusation. Kind of like Obama and Hitler.
Cap and trade would not seem to be favorable to an industry like coal and yet Buffet is...
BETTING ON THE FUTURE OF COAL
Jack Ablin, chief investment officer at Harris Private Bank in Chicago, said the deal was a bet on the future of coal as a source of energy.
"Because Burlington Northern moves coal around the country, I think Buffett is trying to get into coal but doing it in a cheaper way," he said. "It's leveraged against coal's demand without actually having to buy the commodity itself."
Some analysts said the deal did not necessarily signal a wave of mergers and acquisitions in railroads.
"For an outsider to make an acquisition of a railroad or invest a significant amount in a railroad -- you may see more people get interested in that possibility," said George Van Horn, senior analyst with market research firm IBISWorld.
"But as far as seeing railroad themselves merging, I wouldn't expect that right away," he said.
Berkshire said the 50-for-1 split of its Class B shares, which is subject to shareholder approval, would make it easier for smaller BNSF shareholders to swap their stock for Berkshire stock. Class B shares were up 1.5 percent to $3,313.50 in early trading.
Buffett, one of the world's richest men and one of its most revered investors, is known for making big long-term bets. He wrote in The New York Times in October 2008 that he had been buying American stocks in his personal account, a few weeks after the collapse of Lehman Brothers set off worldwide selling.
"Fears regarding the long-term prosperity of the nation's many sound companies make no sense," Buffett wrote at the time.
Sal - as to railroads - you are right -I know next to nothing. I just know that we have moved product by rail and it's slow, very slow for our commodity but a lot cheaper. Perhaps that's not true in other commodities such as food.
As to coal- I'm not sure what will happen-is anybody? There are tons of deals yet to be cut. There may be deals made to protect existing coal plants and jobs while "clean coal" comes on line.
Cap and Trade doesn't stop anything from being sold it just will raise the price of all forms of energy. Since we are facing an always unstable Middle East, new troubles with Russia and an environmental stranglehold on new oil exploration, and nuclear plants the upshot of Cap and Trade may be that the environment doesn't get any cleaner we just all pay a lot more for the same old energy. Coal may remain efficient or necessary for many, many years even under this adverse scenario.
Ah yes. The old non accusation, accusation. Kind of like Obama and Hitler.
What a joke. Always this pressure - oh you better not make an insinuation that anybody did anything "Hitlerlike" or you are a nutcake. You know what that does? It encourages us to ignore history. No one can be compared in any way to Hitler or what happened in Nazi Germany until it's too late. Sorry but history does repeat and it we are not at least watchful, it will repeat right here. It's just this kind of stifling of thought that leads to it.
I make no insinuation that Obama is anything like Hitler. I think he's a socialist, but I think he has good intentions- I think he believes it's what is best for America. I don't like his policies or methods one bit. I think their attempts to control an adoring media and giant sections of the economy including our health care are POSSIBLE forerunners to something much, much worse if it is not held in check.
jamiche
11-03-2009, 01:25 PM
What a joke. Always this pressure - oh you better not make an insinuation that anybody did anything "Hitlerlike" or you are a nutcake. You know what that does? It encourages us to ignore history. No one can be compared in any way to Hitler or what happened in Nazi Germany until it's too late. Sorry but history does repeat and it we are not at least watchful, it will repeat right here. It's just this kind of stifling of thought that leads to it.
I make no insinuation that Obama is anything like Hitler. I think he's a socialist, but I think he has good intentions- I think he believes it's what is best for America. I don't like his policies or methods one bit. I think their attempts to control an adoring media and giant sections of the economy including our health care are POSSIBLE forerunners to something much, much worse if it is not held in check.
"...however, those types of actions are what Hitler did..."
Those are your words, beej.
There are two or three current world leaders whose names could conceivably be used in the same sentence as Hitler. No one who is not crazed with hatred for Obama would suggest that he is one of them. Yes, you did insinuate.
Yes- he has taken some actions like Hitler took. That doesn't mean he is like Hitler. I don't think he is. That means he is doing things that should make one wary. I don't hate Obama - I don't like what he's doing. I have been far more complimentary of him than people such as yourself were of Bush. I have given Obama credit for being a bright man who is well intended. I have clearly explained that my complaint with him lies in his ideology and his efforts to deceptively slide his ideology past a sleeping public under the name "change".
However, if you want to think I compare him directly to Hitler, have at it, I don't care. If it reminds you of what could be and what has been then it will be worth the criticism.
monk10
11-03-2009, 03:05 PM
Wow. *smh*
monk10
11-03-2009, 08:17 PM
I remember a time when you were insulted when someone compared your actions to Hitler. Now you are using them. I'm going to assume you are having a bad day. Come back tomorrow, and hopefully you will see what you have done here.
You are a good man. Remember that.
Gopher4Life
11-04-2009, 08:22 AM
bga1,
>>I think he's a socialist, but I think he has good intentions.<<
Obama is either an ill-prepared imp or a shrewd scammer. Time will tell, but neither is good for America.
I remember a time when you were insulted when someone compared your actions to Hitler. Now you are using them. I'm going to assume you are having a bad day. Come back tomorrow, and hopefully you will see what you have done here.
You are a good man. Remember that.
Thanks for the second to last sentence. If someone so insulted me I've long since forgotten it. Today is another day. Jamiche is attempting to invalidate anything I say based upon inventing this pitch that I compare Obama to Hitler. He does this because his arguments are otherwise devoid of reason- he has nothing.
Read my lips- I don't compare Obama to Hitler. I think Obama's actions and his methods are bad for America. I think he is a bright person who has a completely different vision for America than what has worked in the past or that our founders had. I think he realizes that the ideas will not sell to America when put in the light. However, he believes he can incrementally install these changes with the right marketing.
There is no evidence whatsoever that Obama has any Hitler-like tendencies. I only caution that people blindly following a person, based on fervor and personality as has happened with Obama can lead to some bad unintended consequences- as happened with Hitler. That example is used only so we can learn from history and not even allow the slightest possibility that such a change occurs here on our soil. Right now the level of media control, the disinformation coming from the administration and the number of radicals within it scare me.
I pray for Barack Obama and respect his service and authority as our President. I also vehemently oppose many of his ideas which I believe are against the core of American values.
Powered by vBulletin® Version 4.1.11 Copyright © 2012 vBulletin Solutions, Inc. All rights reserved.