10-year

10-Year Anniversary Promotion (20% off)

Join GuruFocus Premium Membership Now for Only $279/Year

Once a decade discount

Save up to $500 on Global Membership.

Don't Miss It !

Free 7-day Trial
All Articles and Columns »

Buffett's Berkshire Hathaway to Buy New Company

December 31, 2013 | About:
Holly LaFon

Holly LaFon

277 followers

OMAHA, NE/HOUSTON, TX, Dec. 30, 2013 – Berkshire Hathaway Inc. (BRK.A)(BRK.B) is acquiring Phillips Specialty Products Inc. (PSPI), a flow improver business, from Phillips 66 (PSX). In exchange for the share capital of the wholly owned subsidiary, Phillips 66 will receive shares of Phillips 66 common stock currently held by Berkshire Hathaway. The specific number of shares will be determined by the share price at deal closing.

"I have long been impressed by the strength of the Phillips 66 business portfolio," commented Warren E. Buffett, Berkshire Hathaway chief executive officer. "The flow improver business is a high-quality business with consistently strong financial performance, and it will fit well within Berkshire Hathaway. I plan to have James L. Hambrick, CEO of The Lubrizol Corporation, oversee its strategic direction." PSPI leads the science of drag reduction and specializes in developing polymers to maximize the flow potential of pipelines. This transaction is part of Phillips 66's ongoing portfolio management and supports the company's growth strategy.

"Berkshire Hathaway made a strong offer for our high-performing flow improver business," said Greg Garland, Chairman and CEO of Phillips 66. "This transaction optimizes our portfolio and focuses growth on our Midstream and Chemicals businesses."

Following regulatory review, the transaction is expected to close in the first half of 2014. About Berkshire Hathaway

Berkshire Hathaway and its subsidiaries engage in diverse business activities including property and casualty insurance and reinsurance, utilities and energy, freight rail transportation, finance, manufacturing, retailing and services. Berkshire's common stock is listed on the New York Stock Exchange, trading symbols BRK.A and BRK.B.

About Phillips 66

Built on more than 130 years of experience, Phillips 66 is a growing energy manufacturing and logistics company with high-performing Midstream, Chemicals, Refining, and Marketing and Specialties businesses. This integrated portfolio enables Phillips 66 to capture opportunities in the changing energy landscape. Headquartered in Houston, the company has 13,500 employees who are committed to operating excellence and safety. Phillips 66 had $51 billion of assets as of Sept. 30, 2013. For more information, visit www.phillips66.com or follow us on Twitter @Phillips66Co. 


Rating: 2.8/5 (6 votes)

Comments

Charteroak_2000
Charteroak_2000 premium member - 11 months ago
Nice - He swapped appreciated shares  with no taxable event .    Phillips gets to retire the shares like a buyback so works for them too !
ansgarjohn
Ansgarjohn - 11 months ago
Yes indeed, Buffett's selling PSX stocks to the tune of $450 million in cash that comes along with PSPI, no capital gains... Mario Gabelli pointed this out in his Twitter feed; http://www.gabelli.com/Gab_pdf/Twitter/CashRichSpinoff.pdf

Please leave your comment:


Get WordPress Plugins for easy affiliate links on Stock Tickers and Guru Names | Earn affiliate commissions by embedding GuruFocus Charts
GuruFocus Affiliate Program: Earn up to $400 per referral. ( Learn More)
Free 7-day Trial
FEEDBACK