Berkshire Hathaway Wants To Lock Up Wesco (BRK-A, BRK-B, WSC)

Berkshire Hathaway Inc. (NYSE: BRK-B) (NYSE: BRK-A) is trying to make yet another deal in a portfolio holding from its entire public stock holdings.  Warren Buffett and friends are offering to acquire the rest of the 19.9% of Wesco Financial Corp. (NYSE: WSC) shares that it does not currently own.

The Filing states:

• Berkshire’s management determined to propose to Wesco a cash-stock election transaction in which it would acquire the remaining 19.9% of the shares of Wesco that it does not presently own in exchange for Berkshire Class B shares and/or cash valued at the book value per share of Wesco as of a time reasonably contemporaneous with the closing of such a transaction. Berkshire would intend to structure such a transaction so as to be tax-free to Wesco shareholders electing stock, subject to applicable limitations. Berkshire expects to discuss such a transaction with the independent directors of Wesco. Berkshire would only proceed with such a transaction if it is approved by the Board of Directors of Berkshire and the Board of Directors of Wesco (including a majority of the independent directors of Wesco), as well as by a majority of the shares of Wesco not owned by Berkshire voted at any meeting that may be called to consider such a transaction. Berkshire does not know whether any of these approvals will be obtained. If no transaction is agreed upon and approved, Wesco will continue to operate as it does presently as an 80.1%-owned subsidiary of Berkshire.

Wesco subsidiaries are as follows:

• CORT Business Services Corporation
• Relocation Central Corporation
• Precision Steel Warehouse, Inc.
• Wesco-Financial Insurance Company

Wesco Financial is into insurance, furniture rental, and steel service center businesses in the United States.  Its shares are now up 15% at $376.00 on only 30,000 shares per day.  The average volume is only about 7,400 shares and the 52-week range is $297.43 to $416.00.

JON C. OGG