Warren Buffett called into CNBC's Squawk Box this morning (Monday) to discuss Berkshire Hathaway's financing role in a $23 billion dollar deal that has candy-maker Mars buying gum-maker Wm. Wrigley Jr. Co.
That's $80 a share for Wrigley. Current price:
[WWY 76.99 14.54 (+23.28%) ]
Wrigley will become a subsidiary of Mars. Berkshire gets a minority equity stake in the new Wrigley subsidiary.
It's a classic brand-play for Buffett. In a live telephone conversation this morning, Buffett tells the Squawk Box team. "There's really nothing that can go wrong with something like the Wrigley or the Mars Brands."
Buffett says executives at Mars asked him to get involved in the deal, although he notes that acting as a "finance provider" for a deal is not a common Berkshire role.
Charles Rex Arbogast / AP
Some of the Wm. Wrigley Jr. Co.'s 14 brands, including top selling U.S. gum brands Extra, Orbit and Eclipse, are seen at the opening of the Chicago-based chewing gum maker's new research facility in a file photo from Sept. 13, 2005, in Chicago.
And in keeping with his usual hands-off stance when it comes to actually running the companies Berkshire buys, Buffett tells us that "getting operationally involved is not in the cards."
Buffett also touched on the economy during his Squawk conversation, repeating his belief that the U.S. economy is now in a recession, and that the downturn will be longer and deeper than most people think. He's also predicting a "fairly long and fairly deep" housing downturn.
Current Berkshire price:
[US;BRK.A 128400.0 1525.00 (+1.2%) ]
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