DES MOINES, Iowa -- An investor group led by billionaire investor Warren Buffett's Berkshire Hathaway Inc. has agreed to acquire MidAmerican Energy Holdings Co. for about $2.1 billion.
In a deal announced Monday, Berkshire Hathaway of Omaha, Neb., will acquire the Des Moines-based utility for $35.05 per share, about 29 percent over Friday's closing price of $27.25. Berkshire also will assume about $7 billion in debt in the deal.The acquisition is Berkshire's first investment in the energy industry.
"We buy good companies with outstanding management and good growth potential at a fair price, and we're willing to wait longer than some investors for that potential to be realized," Buffett said in a statement. "This investment is right in our sweet spot."
MidAmerican President Gregory E. Abel said his company will benefit from having Berkshire "as our primary sponsor or shareholder" and can count on having "their capital resources and support to any specific transaction we pursue going forward."
MidAmerican merged with the Omaha-based CalEnergy, an international energy company, last March. MidAmerican has about 9,800 employees.
Through its retail utility subsidiaries, MidAmerican Energy in the United States and Northern Electric in the United Kingdom, the company provides electric service to 2.2 million customers and natural gas service to 1.2 million worldwide.
Berkshire will have about a 75 percent interest in MidAmerican Energy. The other investors, who are also based in Omaha, are Walter Scott, former chairman of Omaha-based Peter Kiewit Sons Inc. and MidAmerican's largest individual stockholder, and certain Scott family interests, and David L. Sokol, the chairman and chief executive officer of MidAmerican. Sokol is an Omaha executive whom Kiewit backed as part of its purchase of a controlling stake in CalEnergy.