Warren Buffett Buys A RAILROAD- Berkshire Northern for $34 billion

on Tuesday Buffett's Berkshire Hathaway Inc. agreed to purchase Burlington Northern Santa Fe Corp., for $34 billion betting on the future of the U.S. economy

Burlington Northern, USA's second-largest railroad, is the biggest hauler of food products like corn and coal for electricity, its a clear indicator of the country's economic health. The railroad also ships a large amount of goods from Western ports including everyday items such as refrigerators, clothing and TVs.
Analysts say Buffett is putting both feet in an industry that is expected to grow as the economy gets back on solid ground. If approved, it would be the biggest acquisition ever for Berkshire Hathaway Inc.history.
Berkshire Hathaway already owns about 22 percent of Burlington Northern, and said it will pay $100 a share in cash and stock for the rest of the company, a 31.5 percent premium on Burlington Northern's Monday closing price. Shareholders have the option to convert their stock for a cash payment of $100 per share or receive Berkshire Class A or Class B common stock. Up to 60 percent of the deal is cash and 40 percent is in stock.
"Berkshire's $34 billion investment in BNSF is a huge bet on that company, CEO Matt Rose and his team, and the railroad industry," Buffett said in a statement.