The Kraft Heinz Company has announced its plan to split into two separately listed companies, effectively reversing much of the blockbuster $46 billion merger from a decade ago. This strategic move aims to revive growth after years of sluggish sales and unlock shareholder value.
One new company will primarily focus on shelf-stable meals, including brands like Heinz, Philadelphia, and Kraft Mac & Cheese, with approximately $15.4 billion in 2024 net sales. The second company will be a 'scaled portfolio of North America staples,' encompassing brands such as Oscar Mayer, Kraft Singles, and Lunchables, with about $10.4 billion in 2024 net sales.
CEO Carlos Abrams-Rivera stated that the current complex structure makes it challenging to allocate capital effectively and prioritize initiatives. The separation is intended to allow each company to focus resources and attention to drive better performance and long-term shareholder value creation.
Warren Buffett, whose Berkshire Hathaway is the largest shareholder, expressed disappointment in the split, stating he doesn't believe taking the company apart will fix its problems and noting the estimated $300 million in additional overhead costs. The transaction is expected to close in the second half of 2026.
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