Seven years after Warren Buffett's Berkshire Hathaway invested $300 million in White Mountains Insurance Group, it is selling its 16.3 percent stake in a $836 million deal.
In a news release this morning, White Mountains CEO Ray Barrette says:
""Warren Buffett and Berkshire Hathaway were key to the financing of our acquisition of CGU/OneBeacon in 2001, and all shareholders benefited handsomely from the relationship. White Mountains is now a larger, more diversified business, competing actively in many areas with Berkshire Hathaway. This is a graceful, value-enhancing way to go our separate ways."
Berkshire gets $751 million in cash and a White Mountains subsidiary containing Commercial Casualty Insurance Company and International American Group.
That works out to $485 per share of Bermuda-based White Mountains, which closed last week at $478. Current price:
Reuters notes that Buffett was a "long-time friend" of Jack Byrne, White Mountains' CEO at the time of the initial investment, and a key player in Geico's growth in the 1970s. At that time, Buffett was an investor. Berkshire now owns Geico.
Current Berkshire price:
Questions? Comments? Email me at email@example.com