By Jonathan Stempel

NEW YORK (Reuters) – Berkshire Hathaway, the conglomerate led by billionaire Warren Buffett, paid $2.6 billion last month for the 20% of the Pilot Travel Centers truck stop business it did not already own, after settling a lawsuit over the price.

The price means Berkshire paid about $13.6 billion for Pilot, which operates more than 725 locations in the U.S. and Canada and sold 13 billion gallons of fuel in 2022.

Berkshire disclosed the purchase price in its annual report on Saturday.

Pilot, sometimes known as Pilot Flying J, was founded in 1958 by Jim Haslam after paying $6,000 for a gas station in Virginia. It was later managed by Jimmy Haslam, the billionaire owner of the Cleveland Browns football team.

Berkshire paid $2.76 billion in 2017 for 38.6% of Pilot and $8.2 billion for another 41.4% in January 2023, and subsequently renewed its management.

Pilot, based in Knoxville, Tennessee, added $603 million to Berkshire’s earnings in 2023.

The Haslams had a 60-day annual window to sell their last 20% of Pilot, and the price was based on their profits.

In competing lawsuits in Delaware Court of Chancery, each party accused the other of manipulating Pilot’s accounting in bad faith; The Haslams said Berkshire was undervaluing her stake and Berkshire was concerned she might overpay.

Buffett did not mention Pilot in his annual letter to Berkshire shareholders, also released Saturday, but offered an anecdote about the risk of disappointment in acquisitions.

He recalled how Hugh McCulloch, the first comptroller of the United States, warned national banks in 1863 not to deal with a “knave,” even if they believed they could avoid being deceived.

“Many bankers who thought they could ‘handle’ the scoundrel problem have learned the wisdom of Mr. McCulloch’s advice…and so have I,” Buffett said. “People are not so easy to read. Sincerity and empathy can be easily faked. This is as true now as it was in 1863.”

Berkshire did not immediately respond to a request for comment on Saturday.

Buffett said last May that he wished he had bought all of Pilot in 2017, but the Haslams wouldn’t sell.

(Reporting by Jonathan Stempel in New York; Editing by Daniel Wallis)

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