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News > Deals
Buffett buys carpet maker
September 6, 2000: 12:37 p.m. ET

Berkshire Hathaway offers $19 a share, or about $2.1B, for Shaw Industries
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NEW YORK (CNNfn) - Warren Buffett's Berkshire Hathaway Inc. agreed to acquire Wednesday carpet maker Shaw Industries for $19 a share in cash, or up to $2.1 billion, the latest low-tech move by the wealthy investor.

Berkshire Hathaway Inc. will buy 80.1 percent to 86 percent of Shaw's outstanding shares. The purchase represents a near 56 percent premium over Tuesday's closing price of $12.19. Robert Shaw, chairman of Shaw Industries, and Julian Saul, Shaw president, together with members of their immediate families will each continue to hold at least 5 percent of the company.

The Shaw and the Saul families have the option to sell up to 10 percent at $19 a share, plus the increase in book value per share, to Berkshire Hathaway each year beginning March 31, 2002.

graphicShaw Industries (SHX: Research, Estimates), whose brands include Cabin Crafts and Shaw Rugs, will continue to operate under its current management and will retain its corporate headquarters in Dalton, Ga.

Shaw's board of directors has appointed a special committee to consider the acquisition and no time frame has been set to consummate the deal. Omaha, Neb.-based Berkshire Hathaway (BRK.A: Research, Estimates) is prepared to complete the deal as soon as possible.

The Shaw transaction follows a transaction on June 22 where Berkshire Hathaway bought Justin Industries, a leading U.S. maker of bricks and other products, for nearly $600 million in cash.

In trading Wednesday, Shaw Industries gained $6.56 to $18.75. Back to top

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