Kraft Heinz split summary – major restructure reportedly days away
- Kraft Heinz may announce a business split as early as this week
- The split would separate Kraft products from sauces and condiments
- Combined value of two units could exceed current $33bn market cap
- Move follows similar restructures by Unilever and Kellogg recently
- Kraft Heinz has not yet responded to requests for official comment
Food giant Kraft Heinz is apparently just days away from announcing an historic split. That’s according to reports in the Wall Street Journal (WSJ), the same title which broke the story of the potential split back in July this year.
According to the publication, people “familiar with the matter” say the deal could be finalised and announced as early as this week.
Kraft Heinz split
The rumoured split would see Kraft Heinz spin off a huge portion of its business, which includes Kraft products, and would leave the company comprised of sauces, condiments and spreads.
Kraft Heinz is said to be estimating that two separate units would be worth more than the company’s current $33bn market value, though the WSJ noted plans and timings could still change at the last minute.
The original merger of the two American food giants, Kraft and Heinz was completed in 2015, when Warren Buffett’s Berkshire Hathaway and Brazilian private equity firm 3G Capital combined the former Kraft Foods with H J Heinz, but problems began to emerge just four years later (2019), when Kraft Heinz reduced the value of Kraft and Oscar Mayer meat products by $15bn.
Despite this, The Kraft Heinz Company remains hugely profitable.
The potential split follows a pattern set by several multinationals, including Unilever which is offloading its ice cream business along with numerous other food brands. The Kellogg Company recently split in two and both Kellanova and WK Kellogg are being folded into larger portfolios (Mars, Inc. and Ferrero respectively).
Kraft Heinz has been approached for comment on the matter but is yet to respond.
