Berkshire News Briefs - 6/15/15

Buffett’s Berkshire Hathaway Pays $388 Million for Stake in Australia's IAG (Bloomberg)

Berkshire Hathaway Inc., the investment company run by Warren Buffett, will pay A$500 million ($388 million) for a stake in Insurance Australia Group Ltd. and gain exposure to a fifth of its insurance accounts.

The deal will give the company 20 percent of IAG’s insurance premium payments and make it liable to pay 20 percent of claims over an initial 10-year period, IAG said in a regulatory statement Tuesday. The U.S. group will get a 3.7 percent stake via a placement of new shares, the insurer said.

Perceva offers to buy Berkshire Hathaway’s lingerie brands (Financial Times)

Private equity group Perceva has entered into exclusive talks to buy European underwear brands from Warren Buffett’s group Fruit of the Loom as it attempts to tap into the ever-resilient demand of French women for lingerie.

The group has made an all-equity offer to buy the ladies’ lingerie collections of Variance, Lou, Vanity Fair and BestForm, as well as the swimwear brand Cherry Beach, the group said on Thursday.

Berkshire’s Suncor Bet Endorses Long-Term View for CEO Williams (Bloomberg)

[...] Suncor has the highest gross margins among 18 of the world’s largest oil and natural gas producers, four times higher than Exxon’s, data compiled by Bloomberg show. The margins have risen while those of global and Canadian peers declined, according to the data.

Suncor became Berkshire’s biggest oil holding after the company sold all shares in Exxon last year, while increasing its stake in the Calgary-based producer since the second quarter of 2014.

Warren Buffett Admits He’s Tried to Buy More than Suits in China (WSJ MoneyBeat)

Warren Buffett is big on China. At this year’s annual meeting of his Berkshire Hathaway Inc., he called the country’s growth “totally miraculous.” [...]

And if Berkshire’s holdings don’t reflect this appetite for China, it’s not for lack of trying on Mr. Buffett’s part. Last year, Berkshire made a bid on a substantial block of shares in a major Chinese company, but the deal didn’t work out, the billionaire investor said in an interview. He declined to provide a name. He’s looked at other deals too, but nothing has borne fruit yet. [...]

BNSF expects crude-by-rail volumes to grow after price rebound (FuelFix)

A 37 percent rebound in oil prices will boost crude-by-rail shipments as drillers complete more wells and extract more crude that U.S. pipelines don’t have the capacity to handle, Burlington Northern Santa Fe LLC executive chairman Matthew K. Rose said Monday.

BNSF is preparing for a recovery after shipments of crude and petroleum products by rail fell from a record 17,074 cars the week of Dec. 12 to less than 13,000 in March as crude prices fell by more than half. [...]

Falling oil prices have caused BNSF to reconsider a shift from diesel to liquefied natural gas to fuel locomotives, Rose said. Market changes or carbon pricing are needed to make such a switch economic at current conditions, he said.

North America's BNSF to launch new services along Northern corridor route (Railway Technology)

North America's freight transportation company BNSF Railway is planning to launch expedited and standard intermodal services to and from Chicago and Saint Paul, Minnesota to the Pacific Northwest.

The new schedules, which are set to start in September, are in direct response to market demand and a result of the railway's record capital investments along its Northern Corridor route.

Berkshire Hathaway launches human and social service insurance program (Insurance Business America)

Independent agents working with clients in the human and social service industry may now choose from an array of products and programs that includes Berkshire Hathaway Specialty Group.

The carrier announced this week that it had entered into a partnership and underwriting agreement with Irwin Siegel Agency to provide insurance products for organizations in the social services sector, including community action, paratransit, social services and youth services agencies.