November 9, 2009
Billionaire Warren Buffett purchasing Burlington Northern Santa Fe Corp. railroad
Photo: Nati Harnik / AP
 
Warren Buffett and the billionaire investor's Berkshire Hathaway Inc.
announced on November 3, 2009 that they agreed to buy Burlington Northern
Santa Fe Corp. (BNSF), making a $34 billion bet on the future of the U.S.
economy.  Burlington Northern is the second-largest railroad in the United
States.   

Analysts say that Buffett is planting both feet in an industry that is poised to
grow as the economy gets back on solid ground.  It would be the biggest
acquisition ever for Berkshire Hathaway Inc.

Berkshire Hathaway already owns about 22 percent of BNSF, and will pay $100
a share in cash and stock for the remainder of the company.  

Stocks rose over 28 percent on November 3rd to $97.66 in afternoon trading.
"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.  "Most important of all, however, it's an all-in wager on the economic future of the United States.  I love
these bets," Buffet said.

Berkshire also owns stock in two other major railroads — about 1 percent of the outstanding shares of Union Pacific Corp. and less
than 1 percent of Norfolk Southern Corp.  Buffet also holds shares in CN, the largest Class 1 railroad in Canada.

Buffett started investing in railroads in 2007, but has said he realized a few years late that railroads had become an appealing
investment.  He thinks railroads are a key economic indicator because of the amount of retail and manufactured goods they haul
across the country, stating: "They do it in a cost-effective way and extraordinarily environmentally friendly way.  I basically believe
this country will prosper and you'll have more people moving more goods 10 and 20 and 30 years from now, and the rails should
benefit."

Canada's two largest railways also enjoyed a "Buffet bounce" on November 3rd, following Mr. Buffett’s announcement on his
purchase of BNSF.

Shares of CN and Canadian Pacific jumped in early trading on news of the investment by Berkshire Hathaway.

CN and BNSF are viewed as the two best-run railways in North America.