In the midst of the financial crisis, Warren Buffett has moved in to buy over a company – at a bargain price.
Constellation Energy, a company which is the nation’s largest competitive supplier of electricity to large commercial and industrial customers and the nation’s largest wholesale power seller, was bought over by MidAmerican Energy Holdings Company, a subsidairy of Berkshire Hathaway.
The purchase was paid for in cash for abuot $4.7 billion, or $26.50 per share. For the record, Constellation’s stock closed at $58.37 last Friday and finished 2007 at $102.53.
This would be a classic case of Buffett buying a good company at a great price.
“MidAmerican has been a wonderful steward of its energy assets and the acquisition of Constellation Energy, when completed, will prove beneficial to all constituents,” said Warren Buffett.
This is a good lesson we should all bear in mind. Always focus on the fundamentals of the company and the price you are paying. Do not let market sentiments distract you from your investment objectives. Often, it is when there is blood in the streets that you can get a fantastic price.