PITTSBURGH — An investment consortium including Berkshire Hathaway and 3G Capital has entered into a definitive merger agreement to acquire The H.J. Heinz Co in a transaction valued at $28 billion, including the assumption of debt.
The board of directors of Heinz has unanimously approved the agreement, and Heinz shareholders will receive $72.50 in cash for each share of common stock they own. The value represents a 20% premium to Heinz’s closing share price of $60.48 on February 13, 2013, and a 19% premium to Heinz’s all-time high share price, according to the company.
“The Heinz brand is one of the most respected brands in the global food industry, and this historic transaction provides tremendous value to Heinz shareholders,” William R. Johnson, Heinz chairman, president and chief executive officer. “With Heinz stock recently at an all-time high, and 30 consecutive quarters of organic topline growth, Heinz is being acquired from a position of strength. As a private enterprise, 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.”
The transaction is subject to regulatory and shareholder approval and is expected to close during the third quarter of calendar year 2013.
“Heinz has a strong, sustainable growth potential based on high-quality standards, continuous innovation, excellent management and great-tasting products,” said Warren Buffett, chairman and chief executive officer of Berkshire Hathaway. “Their global success is a testament to the power of investing behind strong brand equities and the strength of their management team and process. We are very pleased to be a part of this partnership.”
After the closing of the acquisition, Heinz will remain headquartered in Pittsburgh as a private company. The transaction will be financed through cash from Berkshire Hathaway and affiliates of 3G Capital, a rollover of existing debt and debt financing from J.P. Morgan and Wells Fargo.