Let's Make a Deal: Buffett Teams Up to Buy Heinz for $28 Billion

February 14, 2013 at 15:38 PM EST

Tags: Buffett, buffett portfolio, Buffett Rule, buffett tax, Heinz, heinz company history, heinz products

Warren Buffett's Berkshire Hathaway Inc. (NYSE: BRK.A, BRK.B) and private equity firm 3G Capital will buy iconic ketchup maker H.J Heinz Co. (NYSE: HNZ) for $28 billion, the largest deal ever in the food industry.

This transaction follows a string of deals including Comcast Corp. (Nasdaq: CMCSA) taking full control of NBC

Universal from General Electric Co. (NYSE: GE), Dell Inc. (Nasdaq: DELL) going private, and American Airlines and U.S. Airways Group Inc. (NYSE: LCC) merging to form the world's largest airline.

The Heinz deal values the Pittsburgh, PA-based company at $72.50 a share, a 20% premium to its all-time price. Berkshire will spend about $12 to $13 billion on the deal, according to Buffett.

"This is my kind of deal and my kind of partner," Buffett said on CNBC's Squawk Box Wednesday, the day of the buyout. "Heinz is our kind of company with fantastic brands."

Shares of Heinz were up 20% following the announcement, while Berkshire was up about 1%.

Comcast, Dell and GE also saw a boost to shares after their recent deals.

The burst of mergers and acquisitions to start the year has many investors surprised, but not Money Morning Capital Wave Strategist Shah Gilani.

Shah has been expecting a rush of M&A activity for some time. The reason is simple: There are trillions of dollars of cash just sitting on the sidelines looking for a deal.

In the video below, Shah analyzes Berkshire's purchase of Heinz and what investors can learn from this mega-deal.

To learn more about other companies primed for a spinoff, merger, acquisition, IPO, or private equity transaction, click here to check out Shah's DealBook.

Deals like this-and the new way to play them could blow away "regular investing" forever.