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Buffett needed two weeks for $11.6 billion Alleghany purchase, balked at Goldman fee -Breaking

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© Reuters. FILEPHOTO: Warren Buffett is seen pause while playing bridge at the Berkshire Hathaway Inc annual meeting in Omaha (Nebraska U.S.A. May 6-8, 2018. REUTERS/Rick Wilking

Jonathan Stempel

NEW YORK, (Reuters) – Warren Buffett took just two weeks for Berkshire Hathaway’s (NYSE:) Inc takeover of Alleghany Corp (NYSE:) Corp. It was its largest acquisition in six year, and despite his refusal to pay the bank fee. A regulatory filing on Monday confirms that.

Alleghany stated that Joseph Brandon, its Chief Executive Officer, met with Buffett at dinner in New York City on February 7, and Buffett then offered $850 per share of cash in exchange for a casual conversation. This was less than the Goldman Sachs banker fee. (NYSE:

Jefferson Kirby, Alleghany Chairman (NYSE:), met Buffett five days later in Omaha, Nebraska. Kirby requested that Buffett make a better offer and pay Goldman $27 million. Buffett also suggested using Berkshire stock as part of financing the purchase.

According to the filing, “Mr. Buffett reiterated his offer terms and stated clearly that he didn’t intend to alter his position on any of those points.”

Berkshire, a company based in Omaha agreed to $848.02 per Share, plus $1.98 for Goldman’s fees.

On March 21, the merger was officially announced. Alleghany had 25 days in which to possibly find a better deal. The filing stated that Goldman had asked 31 possible bidders about their interest. The “go-shop” period will end April 14.

Brandon was in charge of the Berkshire General Re unit between 2001 and 2008.

Buffett (91) has opposed Wall Street business costs since the beginning.

Berkshire has few investment banks, so he relies on Charlie Munger, the Vice Chairman of Berkshire for major capital decisions.

Buffett has praised Byron Trott, a former Goldman banker who worked with him to purchase McLane Co (NYSE:) Inc) and a significant stake in Pilot Flying J Truck Stop Operator from Jimmy Haslam.

After obtaining shareholder and regulatory approvals, the Alleghany acquisition is anticipated to close during the fourth quarter.

The $32.1 billion acquisition of Precision Castparts, an aircraft- and industrial parts manufacturer in 2016, was Berkshire’s most recent major acquisition.

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