Berkshire Hathaway gets approval for acquisition of company with South African operations

The Competition Commission has recommended the approval for Warren Buffett’s Berkshire Hathaway to acquire Alleghany with activities in South Africa.

Alleghany owns operating subsidiaries and manages investments, anchored by a core position in property, and casualty reinsurance and insurance.

Alleghany’s property and casualty subsidiaries include Transatlantic Holdings, RSUI Group, CapSpecialty, and Alleghany Capital.

On 21 March 2022, Berkshire Hathaway and Alleghany entered into an agreement under which Berkshire Hathaway will acquire all outstanding Alleghany shares for $848.02 per share in cash.

The transaction, which was unanimously approved by both Boards of Directors, represents a total equity value of approximately $11.6 billion.

Berkshire Hathaway controls nine South African firms and General Reinsurance, which has local operations.

Alleghany’s activities in South Africa include:

• The provision of non-life reinsurance
• The provision of professional construction consultancy services.
• The sale of toys through distributors.

The Commission found that the proposed transaction is unlikely to result in substantial prevention or lessening of competition in any relevant markets.

It further found that the proposed transaction does not raise any substantial public interest concerns.

The Commission has recommended that the Competition Tribunal approve the proposed transaction without conditions.