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Last year, the company recorded revenues of $10bn with a pre-tax operating income of $2.6bn.

The purchase is Berkshire’s largest, and accelerates its transformation from a company largely dependent on insurance businesses into one resembling the broader U.S. economy, including a railroad, several industrial companies, utilities, a vehicle dealership and consumer goods businesses.

The takeover, Berkshire’s largest ever, extends Buffett’s push into the industrial sector and comfortably exceeds the US$26.5bn deal for Burlington Northern Santa Fe railroad in 2010.

“We see a unique alignment between Warren’s management and investment philosophy and how we manage PCC for the long-term”, said Mark Donegan, Precision Castparts chairman and CEO, in a news release announcing the deal Monday morning.

The deal requires approval by a majority of PCC’s shareholders and the deal is expected to close sometime during the first quarter of 2016 after customary anti-trust regulatory conditions.

Berkshire, which also owns PacifiCorp, another former Fortune 500 company based in Portland, tends to grant its companies wide latitude to maintain their identities and local operations.

Precision Castparts manufactures complex metal components and products for the aerospace industry and also produces products for chemical processing and the oil and gas industry.

But other analysts said the price appeared fair.

ENERGY: U.S. crude was down 15 cents to $43.72 a barrel in electronic trading on the New York Mercantile Exchange.

Shares of Precision Castparts surged 19 percent, or $37.04, to close at $230.92.

“I made him a bid and he took it to the board and before long we had a deal”, Buffett said on the CNBC “Squawk Box” program.

Berkshire will borrow about $10 billion and use about $23 billion of its cash, Buffett said.

“From the Berkshire perspective, they’re getting a good company on sale”, Shields said.

Andrew Carolus, managing director at Mesirow Financial Investment Banking in Chicago, said Buffett is “obviously a believer” in Precision Castparts’ prospects “over the next five to six decades”.

PCC had revenue of more than $10bn in 2014.

In acquiring Precision Castparts, Buffett is clearly betting that demand for commercial aviation will continue to grow and that airline orders for new aircraft will keep coming in.

The pattern is successful companies with long-lasting brands.

Kraft Heinz has proven among his most successful.