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Buffett's Berkshire outbid for Tech Data: CNBC

Published 2019-11-29, 04:31 p/m
Buffett's Berkshire outbid for Tech Data: CNBC
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(Reuters) - Billionaire investor Warren Buffett was thwarted in trying to spend some of the $128.2 billion of cash at his Berkshire Hathaway (NYSE:BRKa) Inc, after a private equity firm outbid him to buy technology equipment distributor Tech Data Corp for $5.14 billion, CNBC said on Friday.

Berkshire did not respond to requests for comment.

Apollo Global Management Inc agreed on Wednesday to pay $145 per share for Tech Data, sweetening its original $130 per share bid after a public company made a better offer.

Citing Buffett, CNBC said that company was Berkshire, which offered $140 per share last week, and did not intend to go higher.

In a regulatory filing on Friday, Tech Data confirmed that on Nov. 24 it had accepted a takeover by an unnamed public company, only to later accept the higher Apollo bid.

Buffett, who is Berkshire's chairman and chief executive, has struggled to invest Berkshire's cash because companies and stocks look pricey, and private equity firms have increased competition for acquisitions.

Buffett does not engage in bidding wars for whole companies, preferring to make a single offer that a target can accept or reject, though he may try to outbid other suitors.

Apollo's original offer for Tech Data had a go-shop provision.

Buffett agreed to make a bid after Bank of America (NYSE:BAC) told him on Nov. 19 that Tech Data was for sale, sent Berkshire Vice Chairman Greg Abel to meet with the company's management, and made a formal offer with other contractual changes that would have benefited Tech Data, CNBC said.

Tech Data approved Berkshire's offer on Nov. 24, CNBC said, but accepted Apollo's higher bid three days later.

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