Buffett’s Berkshire Hathaway to Buy Chemical Company Lubrizol

In the midst of news that world stock markets are dropping as a reaction to the earthquake in Japan, Berkshire Hathaway (NYSE:BRKB) announced this morning that it is acquiring Lubrizol (NYSE:LZ) for around $9 billion in cash.

About the companies:

  • Berkshire Hathaway Inc. (NYSE:BRKB) is a holding company owning subsidiaries in a variety of business sectors.  The Company’s principal operations are insurance based business conducted nationwide on a primary basis and worldwide on a reinsurance basis.  Berkshire’s other operations include The Buffalo News, aviation training, and retail furniture businesses, as well as shoe, candy, and rug manufacturing.
  • The Lubrizol Corporation (NYSE:LZ) supplies performance chemicals to diverse markets worldwide.  The Company develops, sells, and produces specialty additive packages used in transportation and industrial finished lubricants.  Lubrizol groups its products into chemicals for transportation and chemicals for other industries.

Though Berkshire Hathaway is popularly thought of as primarily an uncanny stock picker, whose every trade is closely followed by individual investors, most of its large purchases in recent years have dealt with it having acquired whole companies, not pieces of companies that trade on stock exchanges.

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