Updated from Jan. 28Consumer products giant Procter & Gamble ( PG) is paying a huge price to acquire Gillette ( G), a $57 billion deal detailed Friday that handsomely rewards billionaire Warren Buffett. With its 2005 earnings estimated at $1.90 a share, the deal values Gillette at over 28 times its earnings, a rich valuation in an industry in which P&G trades closer to 18 times earnings and rival Colgate-Palmolive ( CL) fetches 22 times earnings. The price suggests Gillette's largest single shareholder, Buffett's Berkshire Hathaway ( BRKA), drove a hard bargain for a company that P&G has long coveted. For P&G, it's the biggest transaction in the company's history. It will exchange 0.975 of its shares for each share of Gillette, which is based in Boston. The deal was being treated accretively in the stock market, with Gillette adding about $5.5 billion market capitalization compared with the $3.89 billion in dilution suffered at P&G late Friday morning. Gillette shares finished regular NYSE trading Friday at $51.60, up $5.75, or 12.54%. P&G finished Friday's action at $54.15, lower by $1.17, or 2.11% Gillette shares hit a 52-week high of $45.90 on Thursday, having added 23% in 2004. P&G stock has risen 32% in the past two years. Berkshire owns about 96 million shares in Gillette. Buffett, who said he plans to own 100 million P&G shares when the transaction closes, called the buyout "a dream deal" that will "create the greatest consumer products company in the world." "Dream" about covers it. Buffett acquired his stake in Gillette in 1989, buying $600 million in convertible preferred stock to amass an 11% stake in the company. Friday's announcement brings Berkshire's return on the investment to roughly $4 billion.