H.J. Heinz Company, manufacturer of Heinz ketchup, announced today its entrance into a definitive merger agreement in which Heinz will be acquired by an investment consortium formed by Berkshire Hathaway and 3G Capital. Heinz will be purchased for $28 billion, or $72.50 in cash per share.
“The Heinz brand is one of the most respected brands in the global food industry and this historic transaction provides tremendous value to Heinz shareholders,” said Heinz Chairman, President and CEO William R. Johnson. “We look forward to partnering with Berkshire Hathaway and 3G Capital, both greatly respected investors, in what will be an exciting new chapter in the history of Heinz. With Heinz stock recently at an all-time high and 30 consecutive quarters of organic topline growth, Heinz is being acquired from a position of strength. As a private enterprise, Heinz will have an opportunity to drive further growth and advance our commitment to providing consumers across the globe with great tasting, nutritious and wholesome products,” added Johnson.
Berkshire Hathaway and 3G Capital plan to keep Heinz headquartered in Pittsburgh and continue its community outreach efforts and other investments.
“Heinz has strong, sustainable growth potential based on high quality standards, continuous innovation, excellent management and great tasting products. Their global success is a testament to the power of investing behind strong brand equities and the strength of their management team and processes. We are very pleased to be a part of this partnership,” said Warren Buffett, Chairman and CEO, Berkshire Hathaway.
The transaction is expected to close after Heinz shareholder approval in the third quarter of 2013.
“We have great respect for the Heinz brands and the strong business that management and its employees operate around the world. We approached Heinz to explore how we might work together to expand the value of this storied brand. We fully recognize Heinz’s value and heritage and look forward to working together with Heinz’s employees, suppliers and customers as we invest in and support the company’s ongoing global growth efforts,” said Alex Behring, Managing Partner, 3G Capital.
Heinz sells 650 million bottles of ketchup annually and produces approximately “two single-serve packets of ketchup for every man, woman and child on the planet.”