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Warren Buffett's Berkshire Hathaway said Tuesday it will buy railroad operator Burlington Northern Santa Fe for $44 billion.
Berkshire (BRKA, Fortune 500), which already has major stake in the company, said it would acquire the remaining 77.4% of the company in a cash-and-stock offer worth $100 per share.
Widely regarded as both one of the world's richest men and the investment community's more brilliant minds, Buffett called his firm's investment an "all-in wager on the economic future of the United States."
"Our country's future prosperity depends on its having an efficient and well-maintained rail system," Buffett said in a statement.
Burlington Northern (BNI, Fortune 500) shares soared 29% in pre-market trading on the news.
Separately, Berkshire said it was announcing a 50-for-1 split of its Class B common stock. The majority of stock issued by the company in its purchase of Burlington Northern will be its pricier Class A shares, the company said.
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The deal, which would rank as the largest acquisition in Berkshire Hathaway's history, would also include $10 billion of Burlington Northern debt.
It would also expand the already massive portfolio of companies Berkshire already owns. Brand-name businesses such as auto insurer Geico, See's Candy and Fruit of the Loom are all subsidiaries of the Omaha, Neb.-based firm.
The deal is expected to close sometime in early 2010, pending approval by Burlington Northern shareholders and following a review by the Justice Department.
