Warren Buffett's Berkshire Hathaway is buying the insurance company Alleghany in a deal valued at approximately $11.6 billion.

“Berkshire will be the perfect permanent home for Alleghany, a company that I have closely observed for 60 years," Buffett said in a prepared statement on Monday. "Throughout 85 years the Kirby family has created a business that has many similarities to Berkshire Hathaway.."

Berkshire will pay $848.02 per Alleghany Corp. share.

Alleghany, based in New York City, will operate as an independent subsidiary of Berkshire Hathaway after the transaction's closing. It has 25 days to actively solicit and consider alternative acquisition proposals under a “go-shop" provision.

Both companies' boards approved the deal, which is expected to close in the fourth quarter. It still needs approval from Alleghany shareholders.