I can’t say I saw this coming, but it doesn’t surprise me. I looked into Burlington-Northern a couple of times but I never able to convince myself to buy a great company at a fair price. I figured the stock was worth $100, but with the market decline, I also figured better bargains would exist. One thing I did come away with from reading the multiple filings is how big a moat railroads have.

Burlington-Northern Valuation

5 Warren Buffett Quotes On Burlington-Northern Acquisition

“[Burlington Northern] does it in a very cost-effective way and they do it in an extraordinarily environmentally friendly way”

“BNSF last year moved on average a ton of goods 471 miles on one gallon of diesel and it releases far fewer pollutants into the atmosphere. It saves enormously on energy consumption and it diminishes highway congestion.”

“I believe this country will prosper and will have more people moving more good 10 to 30 years from now and the rails should benefit, but it’s a bet on the country”

“I’m not big on stock splits, but by having this split, it enables anybody with as little as one share of BNSF to opt for the tax-free exchange,” said Buffett. “So the small shareholder can have the exactly the same availability that otherwise would only have been available to a big shareholder.”

Source: CNBC: Berkshire Hathaway to Acquire Burlington Northern

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