Initial Jobless Claims
Warren Buffett’s Berkshire Hathaway and 3G Capital buying Heinz
Jobless Claims in U.S. Decreased More Than Forecast Last Week
Ketchup at the Buffett
Warren Buffett’s Berkshire Hathaway Inc. and Jorge Paulo Lemann’s 3G Capital agreed to buy HJ Heinz Co. for about $23 billion as the billionaires increased their bets on consumer products. The buyers will pay $72.50 a share, compared with yesterday’s closing price of $60.48, according to a statement today. Berkshire will spend about $12 billion to $13 billion on the deal for the maker of condiments and Ore-Ida potato snacks, Buffett told CNBC. The deal will also be financed with cash from 3G affiliates, plus the rollover of existing debt, and is valued at about $28 billion including debt, according to the statement.
Heinz will retain its corporate headquarters in Pittsburgh, according to the statement. The company traces its roots back to 1869, when Henry John Heinz and neighbor L. Clarence Noble began selling grated horseradish, according to Heinz’s website. The company introduced its famous Tomato Ketchup in 1876.
Fewer Americans than projected filed applications for unemployment benefits last week, indicating an improving outlook for the labor market. Jobless claims decreased by 27,000, the most in a month, to
341,000 in the week ended Feb. 9. The level of filings was lower than any projection in a Bloomberg survey in which the median forecast was 360,000. A slower pace of dismissals indicates demand is strong
enough for companies to maintain headcounts, a necessary first step toward bigger job and income gains needed to accelerate consumer spending. Further strides in employment would augment advances in the stock market and housing, helping ease the burden of higher payroll taxes on household budgets.
In general, the drops in claims signals better times ahead for the job market.