NEW YORK — Calling it his "all-in wager" on the U.S. economy, Warren Buffett is placing his reputation as the "Oracle of Omaha," as well as the future of his iconic Berkshire Hathaway Inc., on the rails of Burlington Northern Santa Fe Corp.

Berkshire Hathaway on Tuesday announced that it agreed to buy the railroad operator in a $44 billion deal, the company's biggest acquisition ever.

Berkshire, which is offering $100 a share, already owns more than one-fifth of BNSF, so the cost is roughly $26 billion, which will be paid for with about 60 percent in cash and 40 percent in Berkshire shares. Berkshire also is taking on about $10 billion of Burlington debt. That values Burlington at a 30 percent premium to its closing share price on Monday.

For Berkshire, the acquisition puts some of the conglomerate's $20 billion hoard of cash to work in a business that's sensitive to the economic recovery.

"Our country's future prosperity depends on its having an efficient and well-maintained rail system," Buffett said in a statement. "Conversely, America must grow and prosper for railroads to do well."It's an all-in wager on the economic future of the United States," he said. "I love these bets."

The acquisition is a strong endorsement by Buffett of the view that the U.S. economy is on the road to recovery, said Art Hogan, chief market strategist at Jefferies & Co. A buyer would not pick up a railroad "unless you thought the economy was going to do better and that energy prices are going to go higher," he said.

Prior to Tuesday's announcement, shares of Burlington were trading at $76, as the company, like its competitors, struggled with dwindling freight demand. Freight carloads on major U.S. railroads fell 18 percent this year through the week ended Oct. 24 compared with a year earlier, according to the Association of American Railroads.

Buffett, however, is betting that freight demand will pick up, and that Burlington, with its 32,000 miles of track across 28 states, will be in position to take advantage of the economic recovery. BNSF rails connect key West Coast container ports, such as Long Beach, Calif., to inland distribution hubs, such as St. Louis. That's a network primed to pump Asian wares to American consumers when the global economy rights itself.

Buffett is also betting that diesel fuel prices will also rise as the economy recovers. As diesel fuel costs rise, railroads feel only a quarter of the impact that trucking companies see in their costs because locomotives are substantially more fuel efficient in per ton of freight moved, analysts say.

"As energy prices get higher and manufacturers want to ship goods, the value proposition presented by railcar transportation far exceeds that offered by truck traffic," Hogan said.

For Burlington, becoming part of Berkshire may allow it to make longer-term investments and relieve some of the short-term pressure that comes with being a publicly traded company.

"We are thrilled to have the opportunity to become part of the Berkshire Hathaway family," Burlington Chief Executive Matthew Rose said.

Burlington also may get a chance to haul more freight that's produced by some of Berkshire's operating subsidiaries, according to Bill Bergman, an equity analyst at Morningstar. Berkshire's subsidiaries include Acme Brick, underwear maker Fruit of the Loom and electronic components distributor TTI.

The railroad operator may also be able to haul more coal to power stations owned by Berkshire's utility unit, MidAmerican Energy.

"Burlington isn't going to give those services away to Berkshire's other subsidiaries, but the conglomeration of operating subsidiaries could develop a more cohesive team approach in coming years," Bergman added.

Berkshire already owned more than 20 percent of Burlington as Buffett became more bullish on the railroad business in recent years.

Some say Buffett's big bet could trigger a renaissance in investor interest in U.S. railroads.

In addition to BNSF shares, which rose 27.5 percent after the announcement of the deal, other railroad stocks saw significant gains: Union Pacific, Burlington's chief competitor, rose 7.9 percent; CSX Corp., the No. 3 U.S. railroad, climbed 7.3 percent; and Norfolk Southern Corp. increased 5.4 percent.

"Railroads have just gotten the biggest endorsement they possibly could," said John Mims, an analyst at BB&T Capital Markets. "We'll probably be saying in 10 or 15 years that a new rail renaissance began with this acquisition."