IT'S OFFICIAL: Warren Buffett is buying a nuts and bolts supplier for $37 billion

Warren BuffettAP ImagesWarren Buffett.

Berkshire Hathaway is buying Precision Castparts in a $US37.2 billion deal.

According to a statement released Monday, Precision Castparts (PCC) shareholders will get $US235 per share in cash — a 21% premium to the stock’s closing price on Friday.

Various news outlets had reported on this deal over the weekend.

“I’ve admired PCC’s operation for a long time,” Berkshire Hathaway chairman Warren Buffett said in the statement. “For good reasons, it is the supplier of choice for the world’s aerospace industry, one of the largest sources of American exports.”

This is the biggest acquisition ever for Berkshire Hathaway.

In an interview on CNBC Monday morning, Buffett said: “All deals seem expensive to me, but this one doesn’t. We’re certainly paying a very good price.”

PCC is based in Portland, Oregon, and it manufactures some of the metal components that go into aircraft engines and industrial gas turbines. The company earned $US10 billion in revenues and net income of $US1.5 billion during the 2015 fiscal year.

Buffett told CNBC that aerospace and oil and gas would be “good businesses” even after the crash in oil prices.

Following this monster acquisition, Buffett said he would probably be buying a few smaller companies in the next six months and was in negotiations.

The deal is expected to close in the first half of next year, pending shareholder approval.

PCC shares spiked 19% in early trading. On Friday, they closed slightly higher at $US193.94, and they are down 17% for the past year.

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