Warren Buffett Buys Burlington Northern Sante Fe ("BNSF") Railroad
Brett EmisonNovember 03, 2009 12:24 PM
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CNN has reported that Warren Buffett's company, Berkshire Hathaway, will buy railroad corporation Burlington Northern Sante Fe ("BNSF") for $44 billion.
Berkshire (BRKA, Fortune 500), which already has major stake in Burlington Northern, said it would acquire the remaining 77.4% of the company in a cash-and-stock offer worth $100 per share.
The deal, which would rank as the largest acquisition in Berkshire Hathaway's history, would also include $10 billion of Burlington Northern debt.
Matthew Rose, Burlington Northern's chairman and CEO, said the sale of the Fort Worth, Texas-based firm was a "strategic fit" for both the company's customers and employees, during a conference call with investors Tuesday.
No management changes are expected at Burlington Northern as a result of the deal, which is expected to close sometime in early 2010.
Burlington Northern has been under scrutiny recently since a Minnesota Court found that BNSF had attempted to cover up its role in four railroad crossing deaths:
The Court found that BNSF destroyed some evidence, fabricated other evidence, interfered with the investigation and purposefully lied and advanced misleading facts in order to conceal the truth.
The railroad's conduct in destorying evidence and attempting to cover up its role in killing these four young people underscores the dangers of railroad crossing accidents. In the last decade, there have been more than 30,000 railroad crossing accidents that killed more than 3600 people. Half of these collisions occurred at train crossings with active warning devices (including lights, crossing gates or bells). However, as BNSF's conduct shows, how many of these devices were working properly? How many other malfunctions have been covered up by BNSF or other railroad companies?
You can learn more about railroad accidents and railroad safety at our train safety blog or by visiting our train accident web site.
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