Berkshire Hathaway acquires NRG and launches bond business
Berkshire Hathaway, the US insurance group, has acquired the NRG reinsurance business of ING Group NV, for $441 million.
ING will use the proceeds of the sale to fund operations, previously announced acquisitions and a share buyback programme.
The transaction is expected to complete in the first-half of 2008, subject to regulatory approval.
The purchase is the second made by Berkshire during December and brings the total amount spent on acquisitions during the month to almost $5 billion.
Last week Berkshire announced that it had paid $4.5 billion for a 60% share of Marmon Holdings, the manufacturing and services group, in an agreement that provides an option to purchase the entire company by 2014.
Marmon holds more than 125 manufacturing and service businesses worldwide and its annual revenues are around $7 billion.
Also last week, Berkshire Hathaway launched Berkshire Hathaway Assurance, a bond insurer for cities, counties and states that issue bonds to finance sewer systems, schools, hospitals and other public projects.
Some bond insurers are currently experiencing difficulties with their credit ratings because of an increased risk from the mortgage-related bonds they insure, and the new business could quickly make gains from competitors.
Category: Companies News, Insurance News
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