Has Warren Buffett Miscounted His Beans?

Great summary article to highlight the key points of the deal.

Especially the emphasis on how the deal has been structured - 9% is Buffett's go-to figure for preferreds it seems, and he's put his large cash-pile to work.

Another point that isn't really spoken about much (not sure if I've heard it in other commentaries about the deal, but I may be wrong) is the underlying prevailing interest rate.

As Buffett has mentioned in the past, interest rates act as a "financial gravity" on the intrinsic value of every investment in the world - from farmland to real estate to baked beans. A 9% fixed income security in a company of this calibre, when AAA 20 year bonds yield 3.8%, is a more attractive proposition than in a normal interest rate environment. I suppose that was especially the case while $47B was earning nothing on the sidelines. In a low rate environment, he is happy to slightly adjust his "fair value" calculations with this in mind.

This is a long-haul investment for Buffett though. I think it's worth clarifying that he was apparently approached about this deal in December rather than initiating it himself. He was offered terms and accepted, rather than negotiating for himself. This really was 3G's deal, although I'm not sure if Buffett insisted on the preferred structure etc, the price was likely already agreed.

Quite a lot of the time it seems, it's more about "something becoming available" or a proposition to say yes or no to when the phone rings. I think it'd be interesting to know whether he'd have accepted the offer with anyone other than 3G asking - he knows what their management team is capable of.