Multinational conglomerate holding firm Berkshire Hathaway Inc. has inked an $11.6-billion agreement to acquire Alleghany Corp., the company announced in a filing.

  • Berkshire will purchase all outstanding Alleghany shares at $848.02 apiece in cash, bringing the transaction price at 1.26 times its book value at the end of 2021. It also reflects a premium of 29% to the average stock price in the last 30 days.
  • Under the agreement, Alleghany will continue to operate as an independent subsidiary of Berkshire after the closing expected in the fourth quarter of the year subject to stockholder and regulatory approval.
  • Alleghany will be allowed to actively solicit and consider alternative proposals in a 25-day “go-shop” period and has the right to stop the merger agreement for a “superior” proposal compared to the agreement.
  • Alleghany has tapped Goldman Sachs & Co. LLC as the financial advisor and Willkie Farr & Gallagher LLP as legal advisor for the transaction, while Berkshire took Munger, Tolles & Olson LLP as its legal advisor.

Alleghany Chair Jefferson Kirby said the family’s 85 years of having a stake in the company is about to end. He intends to vote his 2.5% shares in favor of the deal. BRK-A closed Friday down 1.05%, while BRK-B is up 0.60% and Y up 24.85% premarket.