Business 508 Assignment 2 Essay

1033 Words Dec 15th, 2014 5 Pages
Assignment #2

Mergers and Acquisitions

Bus 508: Contemporary Business

Berkshire Hathaway is “a holding company that specializes in insurance-related companies, but has a wide array of interests, making it a conglomerate (”. The company is well known due to its owner, investment icon, Warren Buffet. “The second-richest American’s net worth continues to surge, despite his giving away billions, thanks to the juggernaut performance of Berkshire Hathaway (” His current net-worth is $71.2 billion

Jorge Paulo Lemann, Marcel Telles, and Carlos Alberto Sicupira established 3G Capital in 2004. The firm has offices in New York City and Rio de Janeiro. 3G Capital is a global investment firm
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In 2013, Berkshire Hathaway & 3G Capital created a partnership and purchased H.J. Heinz Company in one of the largest food industry acquisitions. The deal was worth $28 billion dollars.

There are several reasons why the acquisition was made, but two stand out. One reason is that it was great marketing move for Heinz to be acquired is the company does not have the financial status needed to market itself globally. The acquisition will assist with their global industry. Per previous Heinz CEO Johnson, “Heinz will have an opportunity to drive further growth and advance our commitment to providing consumers across the globe with great tasting, nutritious and wholesome products (”.

A positive effect is Berkshire Hathaway & 3G have companies all over the globe. They can give Heinz the tools and resources needed to expand into other countries. Heinz also did well in acquisition because Berkshire Hathaway & 3G also included the company’s debt in the deal. Heinz can have a fresh debt free start while the expansion takes place.

Shareholders willingly approved the acquisition. The company is no longer a public traded company and was removed from the New York Stock Exchange. Heinz shareholders received $72.50 in cash for each share of common stock they owned as of the effective time of the merger, without interest and less any applicable withholding taxes (

A negative effect is H.J. Heinz eliminated an

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