September 22, 2008 / 4:30 AM / 10 years ago

Buffett unit to buy Japanese tool maker Tungaloy

TOKYO (Reuters) - IMC International Metalworking Companies, a unit of Warren Buffett’s Berkshire Hathaway Inc (BRKa.N), will buy Japanese machine tool maker Tungaloy Corp in a deal one newspaper said would total $1 billion.

Nomura Principal, a unit of top Japanese brokerage Nomura Holdings (8604.T), said in a statement on Monday that it would sell its 71.2 percent stake in Tungaloy to IMC International Metalworking in late November.

Nomura did not disclose the sale price.

Nomura took control of Tungaloy through a management buyout in 2004 when Tungaloy was split from electronics conglomerate Toshiba Corp (6502.T). It bought a 94 percent stake in the company for 35.75 billion yen at the time.

Tungaloy will sell 19.2 percent of its own shares to IMC, a holding company majority-owned by Berkshire Hathaway that also has Israeli metalworking company Iscar and South Korea’s TaeguTec under its arm, a Tungaloy spokesman said.

Tungaloy had said on Friday that it would buy the same percentage of its own shares from OSG Corp (6136.T), ending their capital and business alliance.

In 2006, billionaire Warren Buffett paid $4 billion for an 80 percent stake in Iscar, in his first non-U.S. investment.

IMC will buy the shares for a total of some $1 billion, according to the website of Israeli business daily Globes online. Japan’s Nikkei business daily said the value would be more than 70 billion yen ($652 million).

Reporting by Sachi Izumi; Editing by Hugh Lawson

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