Bloomberg News

Buffett Says Potential $22 Billion Deal Undermined by Price

May 06, 2012

Berkshire Hathaway Inc. Chairman Warren Buffett at the company's annual shareholders meeting. Photographer: Daniel Acker/Bloomberg

Berkshire Hathaway Inc. Chairman Warren Buffett at the company's annual shareholders meeting. Photographer: Daniel Acker/Bloomberg

Berkshire Hathaway Inc. (A:US) Chairman Warren Buffett said he stepped away from a potential acquisition for about $22 billion because of the price.

“I just couldn’t make the deal,” Buffett said in an interview yesterday with Betty Liu on Bloomberg Television’s “In the Loop” after Berkshire’s annual meeting in Omaha, Nebraska. “We couldn’t come to an agreement.”

Buffett is seeking acquisitions to improve returns on a cash pile that climbed to $37.8 billion (2FA:US) as of March 31. The billionaire has maintained the cash level at more than $20 billion to guarantee liquidity and told investors earlier yesterday that the potential deal would have required Berkshire to sell securities (2FA:US) he would prefer to keep.

Buffett didn’t immediately return a message today seeking comment about yesterday’s remarks or the identity of the potential target company.

“If we can make a good deal tomorrow, whether it’s big or small, we’ll make it,” Buffett said in the interview.

Berkshire acquired Lubrizol Corp., an additives maker, for about $9 billion last year and paid $26.5 billion in 2010 for the 77.5 percent of railroad Burlington Northern Santa Fe it didn’t already own. The CTB Inc. farm-products subsidiary said May 4 it agreed to buy Meyn Holding BV of the Netherlands to expand into slaughtering and packaging equipment for chickens. Terms weren’t disclosed.

To contact the reporter on this story: Noah Buhayar in Omaha at nbuhayar@bloomberg.net

To contact the editor responsible for this story: Dan Kraut at dkraut2@bloomberg.net


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