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Warren Buffett Buys Burlington Northern Sante Fe ("BNSF") Railroad

4 comments

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.

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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.

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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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4 Comments

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  1. Marilyn Monroe says:
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    What planet are you from? I can’t count the number of cars that I see daily trying to beat the train. I believe you insinuate a lot here joker.

  2. Marilyn Monroe says:
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    What planet are you from? I can’t count the number of cars that I see daily trying to beat the train. I believe you insinuate a lot here joker.

  3. Mike Bryant says:
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    I would assume you used a fake name, but just in case MM, there is no insinuation in what happened in the recent Minnesota case and the subsequent ruling. The RR was found to be lying, buying witnesses and hiding/destroying evidence. I would be interested in what intersection you see these daily runners, maybe post some video, and some proof.

  4. Brett Emison says:
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    Mike is correct — there is no insinuation. The Court found that BNSF attempted to cover up its wrongdoing and destroyed evidence. You can read many accounts on the subject with a simple Google search.

    Even if what you say is true, cars and trucks could not try to beat the train if every crossing was equipped with a crossing gate. Gates would be a tremendous deterrent. But most crossings only have a sign with crossbucks (not even flashing lights) that does nothing to actively prevent a railroad crossing crash.