Warren E. Buffett's Berkshire Hathaway is buying the food giant with the Brazilian-backed investment firm that owns a majority stake in a company whose business is complementary to Heinz's: Burger King.
Under the terms of the deal, Berkshire and 3G will pay $72.50 a share. Including debt, the transaction is valued at $28 billion.
"This is my kind of deal and my kind of partner," Buffett told CNBC on Thursday. "Heinz is our kind of company with fantastic brands."
In many ways, Heinz fits Buffett's deal criteria almost to a T. It has broad brand recognition - besides ketchup, it owns Ore-Ida and Lea & Perrins Worcestershire sauce - and has performed well. Over the past 12 months, its stock has risen nearly 17 percent.
Buffett told CNBC that he had a file on Heinz dating to 1980. But the genesis of Thursday's deal actually lies with 3G, an investment firm backed by several wealthy Brazilian families, according to a person with direct knowledge of the matter.
One of the firm's principal backers, Jorge Paulo Lemann, brought the idea of buying Heinz to Berkshire about two months ago, this person said. Buffett agreed, and the two sides approached Heinz's chief executive, William R. Johnson, about buying the company.
Berkshire and 3G will each contribute about $4 billion in cash to pay for the deal, with Berkshire also paying $8 billion for preferred shares. The rest of the cost will be covered by debt financing raised by JPMorgan Chase and Wells Fargo.
Buffett told CNBC that 3G would be the primary supervisor of Heinz's operations, saying, "Heinz will be 3G's baby."
The food company's headquarters will remain in Pittsburgh, Heinz's home for more than 120 years.