Berkshire’s Bid For Alleghany Moves Forward After ‘Go-Shop’ Period Comes Up Empty

Berkshire Hathaway’s $11.6 billion acquisition agreement with Alleghany Corp. is clear to move ahead following the end of the “go-shop” period that allowed Alleghany to attract other bidders.

The New York-based property and casualty insurer said April 18 that it solicited alternative proposals from 31 potentially interested companies but it did not receive any competing offers.

Buffett’s Berkshire Hathaway to Buy Alleghany for $11.6 Billion

The deal is set to close in the fourth quarter after regulatory approvals and approval by Alleghany stockholders. Alleghany will continue to operate as an independent entity.

About a month ago Warren Buffett’s Omaha, Nebraska-based Berkshire Hathaway entered into an agreement with Alleghany to acquire all outstanding Alleghany shares for $848.02 per share in cash in a transaction unanimously approved by both boards of directors. Berkshire said the acquisition price represents a multiple of 1.26 times Alleghany’s book value at Dec. 31, 2021.

According to an April 11 proxy statement, Berkshire Hathaway did not require Alleghany to pay any breakup fee in the event another potential acquirer topped Berkshire’s offer during the 25-day “go-shop” period or thereafter during the “no-shop” period. Additional details of the conversations leading up to the merger agreement between Berkshire and Alleghany can be found in a report from Carrier Management, Insurance Journal’s sister publication.

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