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Berkshire Hathaway buys nearly 10 percent stake in Axalta Coating Systems for $5


racemize
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And not just a regular IPO.  An LBO IPO exit. 

 

A Twitter finance community member just made the point that Carlyle has more than tripled their money with this IPO.  And that speaks poorly for Dupont management.

 

I wonder if this company is a potential acquisition candidate for Berkshire?  Seems like it would be very beneficial to vertically integrate with all of the planes, trains, and automobile activity going on with Berkshire.  Valspar apparently generates 15% EBIT margins on its coatings business, with what looks like a pretty high return on assets.  If you folded Axalta into Lubrizol, could you get a best of breed transportation coatings companies that generates very high returns on investment?  (Just back of the envelope musings, right now.)

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And not just a regular IPO.  An LBO IPO exit. 

 

A Twitter finance community member just made the point that Carlyle has more than tripled their money with this IPO.  And that speaks poorly for Dupont management.

 

I wonder if this company is a potential acquisition candidate for Berkshire?  Seems like it would be very beneficial to vertically integrate with all of the planes, trains, and automobile activity going on with Berkshire.  Valspar apparently generates 15% EBIT margins on its coatings business, with what looks like a pretty high return on assets.  If you folded Axalta into Lubrizol, could you get a best of breed transportation coatings companies that generates very high returns on investment?  (Just back of the envelope musings, right now.)

 

That's the only way I can make sense of the deal.  Whatever the reason, there seems little reason to do a negotiated purchase at a premium to market.  (I saw early reports that it was a 10% premium, but the stock price history doesn't support that as far as I can tell, unless we go back several months, which doesn't make sense.)  Also, it's a pretty small buy for WEB to make personally.

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