Warren Buffett has always loved strong consumer brands, and on Valentine’s Day he put his money where his heart is. Buffett’s investment vehicle Berkshire Hathaway Inc. teamed with 3G Capital Inc. on a $28 billion agreement to buy H.J. Heinz Co., makers of Heinz ketchup. A good chunk of Heinz’s $11.6 billion of sales last year were to 3G Capital portfolio company Burger King Holdings Inc., which the Brazilian-owned private equity firm acquired in 2010.
Heinz shareholders stand to receive $72.50 in cash per share, a 20 percent premium to the target’s closing price on February 13, the day before the deal was announced. Berkshire and 3G Capital will pay a total of $23 billion for Heinz’s equity and will also assume $5 billion in debt. The parties hope to close the deal in the third quarter pending approvals from regulators and Heinz shareholders.
