In a definitive agreement, Berkshire Hathaway Inc. has agreed to acquire 100% of The Lubrizol Corp.'s outstanding shares for $135 per share in an all-cash transaction, a 28% premium to Lubrizol's closing stock price of $105.44 as of March 4, 2011. After the close of the transaction, Lubrizol will operate as a subsidiary of Berkshire Hathaway and will continue to provide technology, service and global supply chain support to its customers.
The transaction, which was unanimously approved by the board of directors of each company, is valued at approximately $9.7 billion, including approximately $0.7 billion in net debt, making it one of the largest acquisitions in Berkshire Hathaway history.
According to James Hambrick, chairman, president and CEO of Lubrizol, the acquisition will allow it to invest in its technology and growth.
The transaction is subject to the approval of Lubrizol's shareholders and the satisfaction of customary closing conditions, including the expiration of waiting periods and the receipt of approvals under the Hart-Scott-Rodino Antitrust Improvements Act and applicable non-U.S. merger control regulations. Berkshire Hathaway and Lubrizol expect the transaction to be completed during the third quarter of 2011.
Lubrizol will remain located at its headquarters in Wickliffe, Ohio, USA, and will continue to be led by its current management team. Lubrizol has not yet reported how the acquisition will affect Noveon Consumer Specialties, its personal care product line or its recent acquisition of Nalco Performance Products Group.