Buffet’s Berkshire Hathaway acquires insurer Alleghany for $11.6bn

October 20, 2022

Warren Buffet Berkshire Hathaway has completed its acquisition of insurance company Alleghany.

Berkshire Hathaway and its subsidiaries engage in diverse business activities including insurance and reinsurance, utilities and energy, freight rail transportation, manufacturing, retailing and services.

Alleghany Corporation owns operating subsidiaries and manages investments, anchored by a core position in property and casualty reinsurance and insurance. Alleghany property and casualty subsidiaries include Transatlantic Holdings, a leading global reinsurer; RSUI Group, which underwrites wholesale specialty insurance coverages; and CapSpecialty, an underwriter of specialty casualty and surety insurance coverages.

Alleghany subsidiary Alleghany Capital Corporation owns and supports a diverse portfolio of eight non-financial businesses.

The purchase represents a total equity value of $11.6bn. Alleghany shareholders received $848.02 in cash per share.

Upon the closing of the transaction, Alleghany became a wholly-owned subsidiary of Berkshire Hathaway. Alleghany continues to be led by Joe Brandon.

Goldman Sachs & Co. LLC served as financial advisor and Willkie Farr & Gallagher LLP served as legal advisor to Alleghany. Munger, Tolles & Olson LLP served as legal advisor to Berkshire Hathaway.

Zesty.ai, a provider of property analytics powered by Artificial Intelligence (AI), and The Berkshire Hathaway Homestate Companies (BHHC) recently expanded their partnership.

The expansion will see BHHC extend the use of Zesty.ai AI-powered wildfire risk model, Z-FIREto 12 states.

Zesty.ai pointed to a recent report from Aon, which found there were three separate wildfires in 2021 alone that generated economic losses beyond $1bn. The company said this highlights the growing importance of property-specific risk models for maintaining coverage in wildfire-prone states.

Last year, Warren Buffett Berkshire Hathaway Inc invested $500m in Brazil Nubank, boosting the fast-growing FinTech firm’s aim to expand across Latin America. Other participants in the round included Sands Capital, Canada Pension Plan Investment Board, MSA Capital, Advent Sunley House Capital and Brazilian asset managers Verde Asset Management and Absoluto Partners.