One of the many companies held in the portfolio of Warren Buffett's investment vehicle Berkshire Hathaway (BRK.A 1.06%) (BRK.B 1.21%) is about to reap a big financial award. On Wednesday, Precision Castparts, which makes components used in the aircraft and oil and gas industries, was awarded 643 million euros ($703 million) in an arbitration hearing.

A panel of the American Arbitration Association's International Center for Dispute Resolution found that Precision Castparts had been fraudulently coaxed into buying Schulz Holding, a Germany-based manufacturer of pipes and fittings. In February 2017, Precision Castparts agreed to pay 800 million euros ($874 million) for the German company. 

Warren Buffett.

Image source: The Motley Fool.

Arbitration proceedings on the matter started in early 2018, with Precision Castparts claiming that Schulz Holding exaggerated its revenue and profitability through fraudulent means such as fake invoices. Schulz Holding denied those claims.

In its 132-page ruling, the arbitration panel characterized the dispute as a nearly open-and-shut case. "The evidence strongly points to fraud, and there is little in the record to suggest otherwise," it wrote in the ruling.

Berkshire Hathaway hasn't commented on the outcome or on the monetary award. Buffett's company bought Precision Castparts in a splashy, $32 billion-plus deal that was agreed to in mid-2015. It was and remains Berkshire's most expensive acquisition. Today, Precision Castparts belongs to Berkshire's portfolio of fully owned companies.

Both classes of Berkshire stock declined a bit more precipitously than the key stock market indexes on Wednesday. The company's A shares fell by 2.1%, while class B dropped 2.1%.