BY Richard Summerfield
A decade after it was formed, American multinational food company Kraft Heinz has announced it is to split into two independent, public businesses.
The spin off of the two companies, which is expected to close in the second half of 2026, will see one company selling Heinz ketchup and the company’s other condiments and boxed meals, which comprise its fastest-growing global brands with $15.4bn in annual sales. The other firm will include slower-growing grocery products, which currently generate revenue of $10.4bn. The names of the two new companies are yet to be determined, but are provisionally called Global Taste Elevation Co and North American Grocery Co, respectively.
“Kraft Heinz’s brands are iconic and beloved, but the complexity of our current structure makes it challenging to allocate capital effectively, prioritize initiatives and drive scale in our most promising areas,” said Miguel Patricio, executive chair of the board at Kraft Heinz. “By separating into two companies, we can allocate the right level of attention and resources to unlock the potential of each brand to drive better performance and the creation of long-term shareholder value.”
“This move will unleash the power of our brands and unlock the potential of our business,” said Carlos Abrams-Rivera, chief executive of Kraft Heinz. “This next step in our transformation is only possible because of the commitment of our 36,000 talented employees who deliver quality and value for consumers every day. We will continue to operate as ‘one Kraft Heinz’ throughout the separation process.”
The 2015 merger of Kraft and Heinz, engineered by veteran US investor Warren Buffett and Brazilian private equity firm 3G Capital, created a $45bn multinational, which is now to be undone. The move follows in the footsteps of a number of other food and drink companies, including Kellogg’s, which broke into two firms in 2023, and Keurig Dr Pepper, which recently said it would undo a 2018 deal that brought together its coffee and beverage businesses. 3G Capital quietly exited its Kraft Heinz investment in 2023, after years of periodically trimming its stake as the company struggled.
Following the announcement of the split, Mr Buffet expressed his disappointment in the decision. Mr Buffet is the outgoing chairman and chief executive of Berkshire Hathaway, which has a 27.5 percent stake in the Kraft Heinz, making it the company’s largest shareholder.
Heinz was founded by Henry J Heinz in Pittsburgh in 1869 to specialise in sauces and condiments. Kraft grew out of a wholesale cheese delivery business set up in Chicago by James L Kraft in 1903. Three years before the merger, Kraft spun off its snack division, which was renamed Mondelez International.