Berkshire Hathaway To Buy Russell Corp.

A WALL STREET JOURNAL NEWS ROUNDUP
April 19, 2006; Page C3

Berkshire Hathaway Inc., the insurance-focused conglomerate run by billionaire Warren Buffett, agreed to buy sports-clothing maker Russell Corp. for about $600 million.

Shareholders in Russell, whose products include Russell Athletic-branded sweatshirts and Spalding leather goods, will receive $18 a share in the acquisition. In after-hours trading, Russell's share price rose $4.70, or 35%, to the proposed acquisition price of $18 from its 4 p.m. price of $13.30 a share in New York Stock Exchange composite trading.

For 2005, Russell posted a 28% decline in its full-year earnings to $34.4 million on revenue of $1.43 billion. In February, the company projected a loss for the first quarter because of restructuring charges.

The deal, which is subject to stockholder and regulatory approvals, is expected to close in the third quarter. "Russell will be better positioned against our world-wide competitors in all three segments of our business, and that includes apparel, sports equipment and athletic shoes," said Chief Executive Jack Ward