Berkshire Hathaway Buys Burlington Northern Santa Fe for $44 billion

Image: Harold Davis/Flickr

Berkshire Hathaway announced today that it is buying railroad company Burlington Northern Santa Fe (BNI) for $44 billion, or $100/share. It is Berkshire Hathaway’s biggest-ever takeover. Bloomberg has more on Warren Buffett, railroad tycoon:

Berkshire has been building a stake in the Fort Worth, Texas-based railroad for more than two years as Buffett looked for what he called an “elephant”-sized acquisition in which he could deploy his company’s cash hoard, valued at more than $24 billion as of the end of June. Trains stand to become more competitive against trucks with fuel prices high, he has said.

Buffett needs “elephants in order for us to use Berkshire’s flood of incoming cash,” he said in his annual letter to shareholders in 2007. “Charlie and I must therefore ignore the pursuit of mice and focus our acquisition efforts on much bigger game.”

Buffett said in 2007 that railroads may prosper at the expense of trucks. “As oil prices go up, higher diesel fuel raises costs for rails, but it raises costs for its competitors, truckers, roughly by a factor of four,” Buffett told shareholders in 2007 at his company’s annual meeting. “There could be a lot more business there than there was in the past.”

Burlington Northern operates 32,000 miles of track, with 6,700 locomotives, according to its Web site. Most of the carrier’s network is west of the Mississippi, where it competes with Union Pacific. The company hauls cargo including grain, coal and so-called intermodal containers, which can move by a combination of rail, road and sea.

Other recent stories

12 John Wooden Quotes for Leadership Success

Image: Wikipedia Hall of Fame basketball player and legendary coach John Wooden turns 99 today. Best known for coaching the UCLA Bruins through 27 winning seasons, Wooden mastered the tenets of leading successfully. Below are 12 John Wooden… Read more

How to Correctly Manage a Pessimist

The Harvard Business Review has a valuable article on managing pessimists in your team. Among the tips: 1. Create awareness. This is best done by pulling the team member aside and explaining how his comments are received. The rule when… Read more

If Workplace Violence is an Issue, Why Do So Few Companies Address It?

New Haven police chief James Lewis recently called Yale student Annie Le’s death “an issue of workplace violence.” Raymond Clark III, accused of choking Le in a Yale lab, then stuffing her body into the building’s wall, was charged with murder… Read more

TrueCar: The Latest Piece of the Zag Pie

I’d like to find a fair price for this Z, please. I read about Santa Monica-based TrueCar in today’s Wall Street Journal. TrueCar, which generates detailed price reports for carbuyers, launched late last month. As most media outlets and blogs… Read more

Women in Business Are Risk Takers

We’ve heard it a million times – that women in business face the ultimate challenge of not taking enough risks. Well, turns out that’s not so ture, at least not about women in business. According to a survey by Boston’s prestigious Simmons… Read more

5 Ways to Honor Your Administrative Assistant on Secretary’s Day

Wednesday is National Administrative Professional’s Day, formerly known as Secretary’s Day. The holiday was established in 1952 to honor people working in secretarial or administrative careers. Today, the name has changed, but the spirit of… Read more

5 Ways Companies Breed Incompetence

Incompetence is a national epidemic. Kids leave high school not knowing how to spell, C-level executives think they can supercede macroeconomic laws, government executives practically sell incompetence wholesale. Fortunately, incompetence has… Read more

Managing People on the Quick

The Harvard Business Review has a good article explaining how to be a better manager in 15 minutes per day. Here’s an excerpt: 1. Turn dead time into development time. Walking back to your office after a meeting? Use those two minutes to… Read more

Honest Tea Only One Aspect of Obama’s .com Management Style

The New York Times has reported that President Obama stocks his fridge with Honest Tea, an organic, Fair Trade, and unconventional beverage symbolic of the many cultural changes he is making within the White House. The article–read it… Read more

President Introduces New “Wagyu Steak” Cocktail Party

The presidential cocktail party took place last night, just in time to celebrate the passage of the new, monopartisan stimulus package. ABC News reports: Six House Democrats, six House Republicans, six Senate Democrats, six Senate Republicans… Read more

The Fortune 500 CEO Hall of Shame

Read more

Women-omics Makes the Case For Economic Power of Women

WOMEN-omics launched last week, but it’s not just for women. This new global web portal is smart, slick, and focused on the economic power of women. Avivah Wittenberg-Cox, corporate gender expert, publisher, and founder of the new… Read more

Steve Jobs’ Hormones Underline Bigger Issue

Is Steve Jobs dying? I don’t think he is. A survivor of pancreatic cancer is bound to have a host of follow-up problems that aren’t necessarily terminal. Indeed, the fine details of Jobs’ testoserone levels are hardly the issue. The real point… Read more

German Billionaire Adolf Merckle Meets Sad Ending

German industrial tycoon Adolf Merckle threw himself in front of a train last night after investment losses broke him of his will to live. In a statement, family members said that Merckle’s companies’ financial losses, coupled with losing… Read more