Buying a Railroad and a 50-1 Stock Split

CNN has reported that my favorite investment guru, Warren Buffett's company, Berkshire Hathaway (BRKA, BRKB), is buying railroad corporation Burlington Northern Sante Fe ("BNSF") for $44 billion.

NEW YORK (CNNMoney.com) -- Warren Buffett's Berkshire Hathaway said Tuesday it will buy railroad operator Burlington Northern Santa Fe 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.

Widely regarded as both one of the world's richest men and the investment community's more brilliant minds, Buffett called his firm's investment an "all-in wager on the economic future of the United States."
- CNN

The railroad giant is also of special interest to me as has offices and shops here in my own hometown, and a number of people here work for the company. I think this a good move for Buffett, whose company already owned 22% of BNSF). Of course the purchase still most face shareholder approval and regulatory review by the Justice Department.

On another note Buffett also announced that class B shareholders (which includes me) would see a 50 to 1 stock split.

OMAHA, Neb.--(BUSINESS WIRE)--Berkshire Hathaway Inc. (NYSE: BRK.A; BRK.B) today announced that its Board of Directors approved a 50-for-1 split of its Class B Common Stock. The stock split is subject to the approval of Berkshire’s shareholders, who must approve an amendment to Berkshire’s certificate of incorporation to increase Berkshire’s total number of authorized shares of common stock, as well as the total number of authorized shares of Class B Common Stock, in order to permit the consummation of this split. Berkshire’s Class A Common Stock is not being split. Berkshire has not yet set the date for the special meeting of its shareholders to vote on the amendment to its certificate of incorporation, or the record date for the stock split.
- Yahoo Finance

That means, if approved my 0.0321 shares would finally be over 1 share, as that fraction of a share would become 1.605 shares. That, in my opinion would be so awesome. I am looking forward to that. As for shareholder approval, I will certainly be sending my proxy vote back in favor of both of these.

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