Berkshire's $11.6B Alleghany deal expands insurance business

Warren Buffett’s Berkshire Hathaway is buying the insurance company Alleghany in a deal valued at approximately $11.6 billion

OMAHA, Neb. -- Warren Buffett, who started the year bemoaning the lack of potential acquisitions for his conglomerate, Berkshire Hathaway, announced Monday that it would acquire the insurance company Alleghany for $11.6 billion.

The scarcity of investment targets over the past several years turned into a cash pile of $146.7 billion at Berkshire by the end of 2021, but the company appears to have found a suitable place for some of that cash in recent days.

The Omaha, Nebraska, company revealed last week that it had compiled a 14.6% stake in Occidental Petroleum, snapping up an additional $1 billion worth of shares just between Monday and Wednesday. That was on top of the more than $6 billion Berkshire spent acquiring shares of the oil producer over the past month.

The all-cash acquisition of Alleghany will expand Berkshire’s already considerable insurance holdings, including brands like Geico auto insurance.