Warren Buffett has dipped into Berkshire Hathaway’s $147bn cash pile for a $12bn deal to purchase Alleghany, an insurance to toy manufacturing conglomerate, ending an acquisition drought that had concerned Berkshire shareholders.

Omaha-based Berkshire, which owns a series of large insurers alongside other companies such as battery maker Duracell and minority stakes in businesses such as food group Kraft Heinz, said on Monday it would pay $848 per share for Alleghany.

Alleghany was founded almost 100 years ago as a railway company and at one point owned nearly a fifth of US track. Now, it owns a range of insurance and reinsurance companies as well as a toy producer, a funeral products maker, a hotel developer and a manufacturer of custom trailers. It produced profits of $1bn last year.