Berkshire Hathaway 2011 Annual Report Download - page 39

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Notes to Consolidated Financial Statements (Continued)
(2) Significant business acquisitions (Continued)
The allocation of the purchase price to Lubrizol’s assets and liabilities is summarized below (in millions):
Assets:
Cash and cash equivalents ................... $ 893
Inventories ............................... 1,598
Property, plant and equipment ................ 2,344
Intangible assets ........................... 3,897
Goodwill ................................. 3,877
Other .................................... 1,077
$13,686
Liabilities, noncontrolling interests and net assets acquired:
Accounts payable, accruals and other liabilities . . $ 1,684
Notes payable and other borrowings ........... 1,607
Income taxes, principally deferred ............. 1,563
Noncontrolling interests ..................... 128
4,982
Net assets acquired ......................... 8,704
$13,686
Lubrizol’s financial results are included in our Consolidated Financial Statements beginning as of September 16, 2011. The
following table sets forth certain unaudited pro forma consolidated earnings data for each of the two years ending December 31,
2011, as if the acquisition was consummated on the same terms at the beginning of 2010. Amounts are in millions, except
earnings per share.
2011 2010
Total revenues .............................................................. $148,160 $141,595
Net earnings attributable to Berkshire Hathaway shareholders ........................ 10,710 13,156
Earnings per equivalent Class A common share attributable to Berkshire Hathaway
shareholders .............................................................. 6,491 8,043
We have owned a controlling interest in Marmon since 2008. In the first quarter of 2011, we acquired 16.6% of the
outstanding common stock of Marmon Holdings, Inc. (“Marmon”) for approximately $1.5 billion in cash, thus increasing our
ownership to 80.2%. We increased our interests in the underlying assets and liabilities of Marmon; however, under current GAAP,
the excess of the purchase price over the carrying value of the noncontrolling interests acquired is allocable to shareholders’ equity
and not to assets or liabilities. We recorded a charge of $614 million to capital in excess of par value in our consolidated
shareholders’ equity as of December 31, 2010 to reflect this difference as such amount was fixed and determinable at that date.
In June 2011, we acquired all of the then outstanding noncontrolling interests in Wesco Financial Corporation for
aggregate consideration of $543 million consisting of cash of approximately $298 million and 3,253,472 shares of Berkshire
Class B common stock.
On February 12, 2010, we acquired all of the outstanding common stock of the Burlington Northern Santa Fe Corporation
(“BNSF”) that we did not already own (about 264.5 million shares or 77.5% of the outstanding shares) for aggregate
consideration of $26.5 billion that consisted of cash of approximately $15.9 billion with the remainder in Berkshire common
stock (80,931 Class A shares and 20,976,621 Class B shares). We accounted for the acquisition using the purchase method and
our allocation of the purchase price to BNSF’s assets and liabilities was completed as of December 31, 2010. BNSF’s financial
statements are included in our Consolidated Financial Statements beginning on February 12, 2010. BNSF is based in Fort
Worth, Texas, and through its wholly owned subsidiary, BNSF Railway Company, operates one of the largest railroad systems
in North America with approximately 32,000 route miles of track (including 23,000 route miles of track owned by BNSF) in 28
states and two Canadian provinces.
Prior to February 12, 2010, we owned 76.8 million shares of BNSF (22.5% of the outstanding shares), which were acquired
between August 2006 and January 2009. We accounted for those shares pursuant to the equity method and as of February 12,
2010, our investment had a carrying value of approximately $6.6 billion. Upon completion of the acquisition of the remaining
BNSF shares, we re-measured our previously owned investment in BNSF at fair value as of the acquisition date. Accordingly, in
2010, we recognized a one-time holding gain of $979 million representing the difference between the fair value of the BNSF
shares that we acquired prior to February 12, 2010 and our carrying value under the equity method.
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