Heinz deal breakup fee totals $1.4 billion -filing

Fri Feb 15, 2013 10:13am EST

* Berkshire, 3G on hook for $700 mln each

* JPMorgan, Wells Fargo provide $14.1 bln debt financing

Feb 15 (Reuters) - If Warren Buffett and Brazilian investment group 3G Capital back away from their proposed $23 billion acquisition of H.J. Heinz Co., they'll have to pay up.

The reverse break-up fee - the amount that Buffett and 3G will have to pay Heinz if they can't close the deal - totals $1.4 billion, according to a regulatory filing on Friday.

Buffett's Berkshire Hathaway and 3G would each pay 50 percent of the fee, the documents said. The fee is roughly 5 percent of the deal value, which includes $5 billion in debt. That's largely in line with historical averages.

J.P. Morgan Chase & Co and Wells Fargo & Co committed to $14.1 billion in debt financing, according to the filing.

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Comments (2)
go2goal wrote:
The financing for these deals come from someplace…..and that means Main Street USA and small businesses will have access to even less money to finance things.

Buffet gets his money the old fashion way…..from teh Big Banks at a deep discount who get their money from the Federal Reserve thanks to tax payers. Yes….and those tax payers are still getting pennies on their ordinary savings……so the super rich (Buffet) get even richer.

The American financial system is the most corrupt system in the world….this is NOT capitalism….not even close. This is socialism for the RICH and the Plutocracy. It is the opposite to what the Teapublicans are telling you….

Feb 15, 2013 10:45am EST  --  Report as abuse
raggedsail wrote:
Yet another business that CEOs have to take out of my city. On top of this company buying up Heinz, the companies headquarters could end up losing employment from “budget cuts”. The Heinz family must be rolling in their graves.

Feb 15, 2013 11:33am EST  --  Report as abuse
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