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Berkshire Hathaway to buy insurance company Alleghany for more than $11 billion

Berkshire Hathaway to buy insurance company Alleghany for more than $11 billion
Last month, Warren Buffett's Berkshire Hathaway reported a $40 billion profit for the fourth quarter of 2021 and full-year earnings were close to $90 billion, the company said.  File Photo by Molly Riley/UPI | License Photo

March 21 (UPI) -- Warren Buffett's Berkshire Hathaway announced Monday that it will buy insurance company Alleghany Corporation for more than $11 billion.

Berkshire Hathaway said it will acquire outstanding Alleghany shares for $848.02 per share in a cash deal that's already been approved by the boards of directors of both companies.

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"Berkshire will be the perfect permanent home for Alleghany, a company that I have closely observed for 60 years," Buffett said in a statement. "Throughout 85 years the Kirby family has created a business that has many similarities to Berkshire Hathaway."

The transaction is expected to close in the fourth quarter of 2022 and is subject to approval by regulators and Alleghany stockholders. Under the deal, Alleghany will continue to operate as an independent subsidiary of Berkshire Hathaway.

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"My family and I have been significant shareholders of Alleghany for over 85 years and are proud that our ownership will culminate through this compelling transaction with Berkshire Hathaway," Jefferson Kirby, chair of the Alleghany board of directors, said in a statement.

"Not only does this deal provide substantial and certain value to stockholders, but it provides a rare opportunity to join forces with a like-minded and highly respected investor and business leader."

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New York-based Alleghany has a number of subsidiaries, including reinsurer Transatlantic Holdings, underwriter CapSpecialty and the Alleghany Capital Corporation, which owns eight non-financial businesses.

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Last month, Berkshire Hathaway reported a $40 billion profit for the fourth quarter of 2021. Full-year earnings were close to $90 billion, the company said.

With a net worth of about $117 billion, Buffett was listed this year as one of the five richest people in the world on Bloomberg's Billionaires Index -- behind only Tesla chief Elon Musk, Amazon founder Jeff Bezos, French investor Bernard Arnault and Microsoft founder Bill Gates.

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