As Warren Buffett told Berkshire Hathaway shareholders last year, "Our elephant gun has been reloaded, and my trigger finger is itchy.” It seems the acquisitions safari has found its big game. Buffett will pay $9 billion for Lubrizol, the world’s largest producer of lubricant additives, in Berkshire Hathaway's second-biggest acquisition in the past five years. Lubrizol, which makes its money from chemicals that go into everything from big diesel engines to personal-care products, is hardly a sexy purchase (unless maybe those personal products include actual lube). But much like Buffett's last big buyout, Burlington Northern Santa Fe railroad, Lubrizol produces tangible goods in an old-school industry. Other investors can have their mobile, social, location-aware, discovery networks, Buffett will just take the billions.
Berkshire Hathaway Will Acquire Lubrizol for About $9 Billion [Bloomberg]
Warren Buffett’s New Deal: What the Heck is Lubrizol? [Deal Journal/WSJ]