-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, OMk380cWOZM6kALU4S2bFz4jeiLeHT4n+V8JGOvzi/aa1bGiP5FodfN1CvZ8Bcn2 g7u1iJjHm6u3M5Io8X1WuQ== 0000898430-99-000209.txt : 19990125 0000898430-99-000209.hdr.sgml : 19990125 ACCESSION NUMBER: 0000898430-99-000209 CONFORMED SUBMISSION TYPE: 8-K/A PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 19981221 ITEM INFORMATION: FILED AS OF DATE: 19990122 FILER: COMPANY DATA: COMPANY CONFORMED NAME: BERKSHIRE HATHAWAY INC CENTRAL INDEX KEY: 0001067983 STANDARD INDUSTRIAL CLASSIFICATION: FIRE, MARINE & CASUALTY INSURANCE [6331] IRS NUMBER: 470813844 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K/A SEC ACT: SEC FILE NUMBER: 333-61129-01 FILM NUMBER: 99509933 BUSINESS ADDRESS: STREET 1: 1440 KIEWIT PLZ CITY: OMAHA STATE: NE ZIP: 68131 BUSINESS PHONE: 4023461400 MAIL ADDRESS: STREET 1: 1440 KIEWIT PLAZA CITY: OMAHA STATE: NE ZIP: 68131 FORMER COMPANY: FORMER CONFORMED NAME: NBH INC DATE OF NAME CHANGE: 19980810 8-K/A 1 AMENDMENT #1 TO FORM 8-K SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 8-K/A CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Date of Report (Date of earliest event reported) December 21, 1998 Berkshire Hathaway Inc. (formerly known as NBH, Inc.) (Exact Name of Registrant as Specified in Charter) Delaware 47-0813844 (State or Other (Commission File (I.R.S. Employer Jurisdiction of Number) Identification No.) Incorporation) 1440 Kiewit Plaza, Omaha, Nebraska 68131 (Address of Principal Executive Offices) (Zip Code) Registrant's telephone number, including area code (402) 346-1400 Not Applicable (Former Name or Former Address, if Changed Since Last Report) Item 7. Financial Statements and Exhibits. (a) Financial Statements of Business Acquired. The financial statements of Old Berkshire and General Re required by this Item 7(a) are incorporated herein by reference to the financial statements of Old Berkshire and General Re set forth in their respective Annual Reports on Form 10-K for the year ended December 31, 1997 and their respective Quarterly Reports on Form 10-Q for the quarter ended September 30, 1998, which financial statements are included herewith as Exhibits. (b) Pro Forma Financial Information. UNAUDITED PRO FORMA COMBINED CONDENSED FINANCIAL STATEMENTS The following unaudited pro forma combined condensed financial statements are based on the historical consolidated financial statements of Old Berkshire and General Re, combined and adjusted to give effect to the Mergers. Certain reclassifications have been made to the historical financial statements to conform with this pro forma presentation. These statements should be read in conjunction with the historical financial statements and notes thereto. The unaudited pro forma combined condensed statements of earnings for the year ended December 31, 1997 and for the nine months ended September 30, 1998 present the results for Old Berkshire and General Re as if the Mergers occurred at the beginning of each period presented. The accompanying unaudited pro forma combined condensed balance sheet as of September 30, 1998 gives effect to the Mergers as of that date. The pro forma adjustments are based upon preliminary estimates, information currently available and certain assumptions that management believes are reasonable under the circumstances. New Berkshire's actual consolidated financial statements will reflect the effects of the Mergers on and after the effective time rather than the dates indicated above. The unaudited pro forma combined condensed financial statements neither purport to represent what the combined results of operations or financial condition actually would have been had the Mergers and related transactions in fact occurred on the assumed dates, nor to project the combined results of operations and financial position for any future period. The General Re merger will be accounted for by the purchase method and, therefore, assets and liabilities of General Re will be recorded at their fair values. The excess of the purchase cost over the fair value of net assets acquired at the effective time of the General Re merger will be recorded as goodwill. Allocations included in the pro forma statements are based on analysis which is not yet completed. Accordingly, the final value of the purchase price and its allocation may differ, perhaps significantly, from the amounts included in these pro forma statements. The Mergers became effective on December 21, 1998. At the effective time of the Mergers, each issued and outstanding share of General Re Common Stock was converted into the right to receive, at the General Re holder's election, either 0.0035 Class A shares or 0.105 Class B shares of New Berkshire Common Stock. Elections must be made by March 1, 1999. Holders that have not made an election by March 1, 1999 will receive shares of New Berkshire Class B Common Stock for their shares of General Re Common Stock. The pro forma combined condensed financial statements assume that all General Re shares were converted into Class A shares at the fixed exchange ratio of 0.0035. The total value of the consideration for pro forma purposes was determined using the average closing price of Old Berkshire Class A Common Stock on the NYSE for the ten day trading period ended June 26, 1998. The total consideration for the transaction, including the estimated value of New Berkshire stock options issued in exchange for General Re employee stock options outstanding, was $22.0 billion. Berkshire and General Re Unaudited Pro Forma Combined Condensed Statement of Earnings For the year ended December 31, 1997 (in millions)
Historical ---------- Pro Forma Berkshire General Re Adjustments Pro Forma --------- ---------- ----------- --------- Revenues: Insurance premiums earned... $4,761 $6,607 $11,368 Sales and service revenues.. 3,578 83 3,661 Interest, dividend and other investment income.... 953 1,314 $ (104) A 2,163 Income from financial services................... 32 302 334 Realized investment gain.... 1,106 3 1,109 ------ ------ ------ ------- 10,430 8,309 (104) 18,635 ------ ------ ------ ------- Cost and Expenses: Insurance losses and loss adjustment expenses........ 3,420 4,671 8,091 Insurance underwriting expenses................... 880 1,955 63 B 2,898 Cost of products and services sold.............. 2,187 2,187 Selling, general and administrative expenses.... 921 269 1,190 Goodwill amortization....... 83 29 332 C 444 Interest expense............ 112 58 (2) D 168 ------ ------ ------ ------- 7,603 6,982 393 14,978 ------ ------ ------ ------- Earnings before income taxes and minority interest 2,827 1,327 (497) 3,657 Income taxes................ 898 302 (57) E 1,143 Minority interest........... 28 57 85 ------ ------ ------ ------- Net earnings................. $1,901 $ 968 $ (440) $ 2,429 ====== ====== ====== ======= Net earnings per common share* $1,542 $ 1,615 Average common shares outstanding* 1,233,192 270,824 1,504,016
* Average shares outstanding for 1997 include average Class A common shares and average Class B common shares determined on an equivalent Class A common stock basis. Net earnings per common share shown above represents net earnings per equivalent Class A common share. Net earnings per Class B common share is equal to one-thirtieth (1/30) of such amount or $54 per share on a pro forma basis. See the accompanying notes to the unaudited pro forma combined condensed financial statements. Berkshire and General Re Unaudited Pro Forma Combined Condensed Statement of Earnings For the nine months ended September 30, 1998 (in millions)
Historical ---------- Pro Forma Berkshire General Re Adjustments Pro Forma --------- ---------- ----------- --------- Revenues: Insurance premiums earned..................... $ 3,983 $4,436 $ 8,419 Sales and service revenues.................... 3,150 67 3,217 Interest, dividend and other investment income...................... 774 1,057 $ (78) A 1,753 Income from financial services................ 36 266 302 Realized investment gain...................... 2,227 293 2,520 ------- ------ ----- ------- 10,170 6,119 (78) 16,211 ------- ------ ----- ------- Cost and Expenses: Insurance losses and loss adjustment expenses.......................... 2,962 3,083 6,045 Insurance underwriting expenses..................................... 804 1,404 47 B 2,255 Cost of products and services sold............ 2,053 2,053 Selling, general and administrative expenses..................................... 744 201 945 Goodwill amortization......................... 73 21 250 C 344 Interest expense.............................. 82 114 (2) D 194 ------- ------ ----- ------- 6,718 4,823 295 11,836 ------- ------ ----- ------- Earnings before income taxes and minority interest............................. 3,452 1,296 (373) 4,375 Income taxes.................................. 1,166 331 (43) E 1,454 Minority interest............................. 23 47 70 ------- ------ ----- ------- Net earnings................................... $2,263 $ 918 $(330) $ 2,851 ======= ====== ===== ======= Net earnings per common share* $1,822 $1,884 Average common shares outstanding* 1,242,075 270,824 1,512,899
* Average shares outstanding for the nine months ended September 30,1998 include average Class A common shares and average Class B common shares determined on an equivalent Class A common stock basis. Net earnings per common share shown above represents net earnings per equivalent Class A common share. Net earnings per Class B common share is equal to one- thirtieth (1/30) of such amount or $63 per share on a pro forma basis. See the accompanying notes to the unaudited pro forma combined condensed financial statements. Berkshire and General Re Unaudited Pro Forma Combined Condensed Balance Sheet September 30, 1998 (in millions)
Historical ---------- Pro Forma Berkshire General Re Adjustments Pro Forma --------- ---------- ----------- --------- ASSETS Cash and cash equivalents............................... $ 6,892 $ 296 $ 7,188 Investments: Securities with fixed maturities.................... 5,069 18,284 23,353 Equity securities and other investments............. 31,193 6,422 37,615 Receivables............................................. 1,900 5,325 7,225 Assets of financial services............................ 1,397 13,377 14,774 Goodwill of acquired businesses......................... 4,071 961 $13,442 F 18,474 Other assets............................................ 3,588 1,339 4,927 ------- ------- ------- -------- $54,110 $46,004 $13,442 $113,556 ======= ======= ======= ========= LIABILITIES AND SHAREHOLDERS' EQUITY Losses and loss adjustment expenses..................... $ 7,513 $16,631 $ 24,144 Unearned premiums....................................... 1,583 1,947 3,530 Accounts payable, accruals and other liabilities........ 2,226 3,513 29 G 5,574 (194) H Income taxes, principally deferred...................... 8,345 1,306 -- I 9,651 Borrowings under investment agreements and other debt... 1,792 294 52 J 2,138 Liabilities of financial services....................... 1,222 12,800 14,022 ------- ------- ------- -------- 22,681 36,491 (113) 59,059 Minority shareholders' interests........................ 472 1,063 1,535 Total shareholders' equity.............................. 30,957 8,450 13,555 K 52,962 ------- ------- ------- -------- $54,110 $46,004 $13,442 $113,556 ======= ======= ======= ========
See the accompanying notes to the unaudited pro forma combined condensed financial statements. Notes to the Unaudited Pro Forma Combined Condensed Financial Statements The pro forma adjustments to the combined condensed statements of earnings are described below. (A) Reduction of interest income due to amortization of purchase accounting adjustments related to the cost of General Re's investments in securities with fixed maturities. (B) Estimation of (1) the increase in compensation expense related to the anticipated replacement of General Re's employee stock option plan with a new incentive compensation plan that will not require the issuance of stock options or securities of New Berkshire and (2) the increase in compensation expense related to the use of non-dividend paying New Berkshire stock with respect to the General Re Employee Savings and Stock Ownership Plan ("ESSOP"). (C) Amortization of the excess of purchase price over the fair value of net assets acquired, net of the elimination of goodwill amortization included in General Re's historical statement of earnings. The excess of purchase price over fair value of net assets recorded with respect to the Mergers will be amortized ratably over 40 years. (D) Amortization of purchase accounting adjustments related to General Re's outstanding debt. (E) Income tax effects on pro forma adjustments. The purchase accounting and pro forma adjustments related to the combined condensed balance sheet are described below. Dollar amounts are in millions. (F) Excess of purchase price (including acquisition costs) over the fair value of net assets acquired ($14,403), less the elimination of goodwill included in General Re's historical balance sheet ($961). (G) Accrual of merger costs which were unpaid at September 30, 1998. (H) Conversion of General Re's redeemable cumulative convertible preferred stock into New Berkshire common stock ($144) and adjustment of related ESSOP loan balance to fair value ($50). (I) Income tax liabilities applicable to pro forma adjustments to ESSOP loan balance adjustment ($18) less deferred tax asset attributed to fair value adjustments to General Re's outstanding debt ($18). (J) Adjustment of General Re's outstanding debt to fair value. (K) Issuance of 270,824 Class A equivalent New Berkshire shares in exchange for General Re Shares ($21,135), plus the estimated value of Berkshire stock options issued in exchange for General Re stock options outstanding, ($870) less elimination of General Re's historical shareholders' equity accounts ($8,450). (c) The following exhibits are filed herewith or incorporated by reference herein: Exhibit Number Description 2.1 Joint Proxy Statement/Prospectus, dated August 12, 1998 of Berkshire Hathaway Inc. and General Re Corporation (Incorporated by reference (File Nos. 1-10125 and 1-8026)) 23.1 Consent of Deloitte & Touche LLP (Incorporated by reference to Exhibit 23.1 to the Current Report on Form 8-K of Berkshire Hathaway Inc. dated December 21, 1998) 23.2 Consent of PricewaterhouseCoopers LLP (Incorporated by reference to Exhibit 23.2 to the Current Report on Form 8-K of Berkshire Hathaway Inc. dated December 21, 1998) 99.1 Consolidated Financial Statements of Berkshire Hathaway Inc. and Notes thereto (Incorporated by reference to the Annual Report on Form 10-K of Berkshire Hathaway Inc. for the year ended December 31, 1997 (File No. 1-10125)) 99.2 Interim Consolidated Financial Statements of Berkshire Hathaway Inc. and Notes thereto (Incorporated by reference to the Quarterly Report on Form 10-Q of Berkshire Hathaway Inc. for the quarter ended September 30, 1998 (File No. 1- 10125)) 99.3 Consolidated Financial Statements of General Re Corporation and Notes thereto (Incorporated by reference to the Annual Report on Form 10-K of General Re Corporation for the year ended December 31, 1997 (File No. 1-8026)) 99.4 Consolidated Interim Financial Statements of General Re Corporation and Notes thereto (Incorporated by reference to the Quarterly Report on Form 10-Q of General Re Corporation for the quarter ended September 30, 1998 (File No. 1-8026)) 99.5 Joint Press Release of Berkshire Hathaway Inc. and General Re Corporation issued December 21, 1998 (Incorporated by reference to Exhibit 99.5 to the Current Report on Form 8-K of Berkshire Hathaway Inc. dated December 21, 1998) 99.6 Press Release of Berkshire Hathaway Inc. issued December 23, 1998 (Incorporated by reference to Exhibit 99.6 to the Current Report on Form 8-K of Berkshire Hathaway Inc. dated December 21, 1998) SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. BERKSHIRE HATHAWAY INC. By: /s/ Marc D. Hamburg ---------------------------- Name: Marc D. Hamburg Title: Vice President and Chief Financial Officer Dated: January 22, 1999 EXHIBIT INDEX Exhibit Number Description 2.1 Joint Proxy Statement/Prospectus, dated August 12, 1998 of Berkshire Hathaway Inc. and General Re Corporation (Incorporated by reference (File Nos. 1-10125 and 1-8026)) 23.1 Consent of Deloitte & Touche LLP (Incorporated by reference to Exhibit 23.1 to the Current Report on Form 8-K of Berkshire Hathaway Inc. dated December 21, 1998) 23.2 Consent of PricewaterhouseCoopers LLP (Incorporated by reference to Exhibit 23.2 to the Current Report on Form 8-K of Berkshire Hathaway Inc. dated December 21, 1998) 99.1 Consolidated Financial Statements of Berkshire Hathaway Inc. and Notes thereto (Incorporated by reference to the Annual Report on Form 10-K of Berkshire Hathaway Inc. for the year ended December 31, 1997 (File No. 1-10125)) 99.2 Interim Consolidated Financial Statements of Berkshire Hathaway Inc. and Notes thereto (Incorporated by reference to the Quarterly Report on Form 10-Q of Berkshire Hathaway Inc. for the quarter ended September 30, 1998 (File No. 1- 10125)) 99.3 Consolidated Financial Statements of General Re Corporation and Notes thereto (Incorporated by reference to the Annual Report on Form 10-K of General Re Corporation for the year ended December 31, 1997 (File No. 1-8026)) 99.4 Consolidated Interim Financial Statements of General Re Corporation and Notes thereto (Incorporated by reference to the Quarterly Report on Form 10-Q of General Re Corporation for the quarter ended September 30, 1998 (File No. 1-8026)) 99.5 Joint Press Release of Berkshire Hathaway Inc. and General Re Corporation issued December 21, 1998 (Incorporated by reference to Exhibit 99.5 to the Current Report on Form 8-K of Berkshire Hathaway Inc. dated December 21, 1998) 99.6 Press Release of Berkshire Hathaway Inc. issued December 23, 1998 (Incorporated by reference to Exhibit 99.6 to the Current Report on Form 8-K of Berkshire Hathaway Inc. dated December 21, 1998) -----END PRIVACY-ENHANCED MESSAGE-----