A majority of Lubrizol shareholders voted Thursday to support Berkshire Hathaway Inc.'s $9 billion offer to buy the specialty chemical company for $135 cash per share.
At a special shareholder meeting, Lubrizol said investors who control 95 percent of Lubrizol's shares voted to support selling the company to Warren Buffett's Omaha-based conglomerate.
The deal that was announced in March also includes Berkshire assuming about $700 million in Lubrizol debt.
Lubrizol's Chairman and CEO James Hambrick said he's excited about what this deal will mean for the company's future.
"The acquisition leaves us well positioned to continue executing our growth agenda which includes geographic expansion, product innovation, investment in infrastructure and complementary acquisitions," Hambrick said.
Lubrizol makes chemicals for pharmaceutical companies, fuel additives for gasoline and diesel and other ingredients for the transportation sector. Last month, it said first quarter net income grew to $169.5 million, or $2.57 per share, over the previous year's $162.3 million, or $2.32 per share.
If regulators approve, the deal should close in the third quarter. Lubrizol is expected to keep its Wickliffe, Ohio, headquarters and current management because Berkshire typically allows the companies it acquires to continue operating much like they did beforehand.
Both companies' stock improved after the vote was announced. Lubrizol shares gained 9 cents to trade for $134.39 Thursday morning. Berkshire's Class B shares increased 43 cents to $74.76.
Buffett did not immediately respond to a message after Thursday morning's vote.
The Lubrizol deal received a great deal of attention at Berkshire's recent shareholders meeting because there were a number of questions about the actions of former Berkshire executive David Sokol, who helped make the Lubrizol deal happen.
Sokol bought nearly 100,000 Lubrizol shares in early January for about $100 a share even though he knew Lubrizol's board had been discussing Berkshire's possible interest in acquiring the chemical company. Sokol had initiated talks with Lubrizol executives.
Buffett has called Sokol's actions unethical and inexcusable.
Sokol resigned after disclosing his trades to Berkshire, but he has denied any wrongdoing. Sokol says he left Berkshire to start his own firm.
Before Sokol resigned, many investors had speculated that he was one of the top candidates to one day succeed Buffett as Berkshire's CEO. Buffett has never identified those candidates.
Berkshire owns roughly 80 subsidiaries, including clothing, furniture and jewelry firms, but its insurance and utility businesses typically account for more than half of the company's net income. It also has major investments in such companies as Coca-Cola Co. and Wells Fargo & Co.
Berkshire Hathaway Inc.: www.berkshirehathaway.com
Lubrizol Corp.: www.lubrizol.com
Transcript of comments made about Sokol at annual meeting: http://bit.ly/iBTCbj