Berkshire Hathaway – Warren Buffett’s company – has come to an agreement where they will trade roughly $1.4 billion of stock that it has in Phillips 66, and receive one of the chemical businesses from the refiner.
On Monday, the Houston-based Phillips 66 mentioned that Berkshire Hathaway is going to give up about 19 million of its 27.2 million shares in the company in order to acquire this business. The business makes additives that allow crude oil to flow easier through pipelines.
The exact number of required shares is going to be determined by the Houston-based companies and stock price at the close of the deal. This is expected to go through during the first half of 2014.
Buffett mentions that the business Berkshire Hathaway is buying consistently delivers strongly in performance. He also mentions that Lubrizol, Berkshire Hathaway’s Ohio-based specialty chemical maker is going to oversee the strategic direction of the unit.
On Monday, Phillips 66 stock closed at $74.72, down three cents on the day.