Secretary of State John Kerry's family financial portfolio could grow by hundreds of thousands of dollars as a result of the $23 billion megadeal between Nebraska billionaire Warren Buffett and a Brazil-owned investment firm to buy out ketchup and food producer H.J. Heinz Co.
Kerry, as part of his confirmation last month, agreed to divest holdings in dozens of companies after leaving his Massachusetts Senate seat. But Kerry's wife, Teresa Heinz Kerry, held at least $3 million in Heinz stock through family trusts as of 2010, according to his most recent financial disclosure form. She was allowed to keep those assets under a January agreement approved by government ethics officials.
Under the terms of the Heinz deal announced Thursday, Buffett's Berkshire Hathaway and 3G Capital, an investment firm based in Rio de Janeiro and New York, will pay $72.50 a share for Heinz, which closed at $60.48 on Wednesday. The buyers will pay $23 billion in cash and assume more than $4 billion in debt.
Kerry did not file an updated financial disclosure before his confirmation, so it is not clear whether his wife's trusts sold off any of its Heinz stock since 2010. But based on the Kerrys' known Heinz stock holdings of about $3 million and the stock's $49.46 per share value at the end of 2010, the couple could have reaped as much as $1 million from the terms of the offer, according to an Associated Press analysis.
Kerry told State Department officials earlier this year that his wife is a beneficiary of three family trusts, each of which held more than $1 million in Heinz stock in 2010. In his recent divestment agreement, Kerry said he was not a beneficiary of his wife's trusts but agreed to recuse himself from decisions involving the Heinz company when appropriate.
Teresa Heinz Kerry's personal fortune is reportedly worth as much as $1.2 billion, stemming from her earlier marriage to former Pennsylvania Sen. John Heinz III, who died in 1991 in a helicopter crash. Much of John Kerry's own wealth comes from his own family trusts. Worth as much as $125 million according to his disclosures, Kerry had been the wealthiest U.S. senator until he joined the Obama administration last month.
"I will need to recuse from certain matters involving H.J. Heinz Company because the investment of the trusts in H.J. Heinz Company stock is greater than their investment in other publicly traded stocks," Kerry told the State Department's Deputy Legal Adviser Richard C. Visek on Jan. 8.
Kerry also agreed to bow out when necessary from State decisions that could affect 16 of Heinz' foreign subsidiaries and partners.
The agreement indicated Kerry would complete the divestments and other arrangement within 90 days of his confirmation, which occurred Jan. 29. State officials were not immediately available to comment on the Heinz deal's impact on his finances and divestment plans.
AP Business Writer Seth Sutel in New York contributed to this report.