H.J. Heinz, the food giant, says it has entered into an agreement to be acquired by Berkshire Hathaway and 3G Capital.
Shareholders will receive $72.50 in cash for each share of common stock they own, in a transaction valued at $28 billion, including the assumption of Heinz's outstanding debt, the company says.
The offer price is a 20% premium to Heinz stock's closing price Wednesday of $60.48 a share.
In pre-market trading Thursday the stock soared past the offering price, but after Buffett said on CNBC that he wouldn't pay more than $72.50, the stock fell back to $72.56. Later, it was trading at $72.50 a share.
"As a private enterprise, Heinz will have an opportunity to drive further growth and advance our commitment to providing consumers across the globe with great tasting, nutritious and wholesome products," said Heinz CEO William Johnson.
The deal has been approved by Heinz's board but does require approval by the company's shareholders.
Warren Buffett, chairman and CEO of Berkshire Hathaway, said, ""Heinz has strong, sustainable growth potential based on high quality standards, continuous innovation, excellent management and great tasting products. Their global success is a testament to the power of investing behind strong brand equities and the strength of their management team and processes."
Berkshire and 3G say Heinz will keep its global headquarters in Pittsburgh.
3G Capital is a global investment firm. Buffett told CNBC that 3G brought the deal to him in December, and that the two firms will be equal equity partners in Heinz and in the financing for the deal.
In addition to Heinz ketchup, the company's brands include Heinz sauces, soups, beans, pasta and infant foods, Ore-Ida potato products, Weight Watchers Smart Ones entrées, T.G.I. Friday's snacks, and Plasmon infant nutrition products.
Ray Goldbacher, USA TODAY