New York (HedgeCo.Net) – Business magnate and philanthropist Warren Buffet announced plans to buy an affiliate of energy manufacturing and logistics company Philips 66. Phillips Specialty Products Inc. (PSPI), develops polymers that reduce drag help improve flow potential in pipelines.
“I have long been impressed by the strength of the Phillips 66 business portfolio,” Buffett said. “The flow improver business is a high-quality business with consistently strong financial performance, and it will fit well within Berkshire Hathaway. I plan to have James L. Hambrick, CEO of The Lubrizol Corporation, oversee its strategic direction.” Buffet acquired Lubrizol in 2011 for approximately $9 billion.
In exchange for the share capital of the wholly owned subsidiary, Phillips 66 will receive around $1.4 billion in stock according to Reuters. The specific number of shares will be determined by the share price at deal closing.
Following regulatory review, the transaction is expected to close in the first half of 2014.
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