04 Sep 2025 Kraft Heinz confirms split into two companies
Mega food conglomerate Kraft Heinz has announced that it is peeling itself apart and undoing one of the biggest food industry mergers.….
Kraft Heinz has confirmed the US food and drinks giant will split into two publicly listed companies in a plan approved by the board of directors.
The company will consolidate brands like Heinz, Philadelphia cream cheese, and Kraft Mac & Cheese under a new entity called Global Taste Elevation Co, and will put lower-performing brands like Maxwell House, Oscar Mayer, Lunchables, and Kraft Singles under a company called North American Grocery Co.
Miguel Patricio, the executive chair of Kraft Heinz’s board, explained the thinking behind the separation.
“Kraft Heinz’s brands are iconic and beloved, but the complexity of our current structure makes it challenging to allocate capital effectively, prioritise initiatives and drive scale in our most promising areas.
“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.”
Kraft Heinz said the business split is expected to be completed in the second half of next year.
Current group CEO Carlos Abrams-Rivera, who will lead the Grocery Co, said: “This move will unleash the power of our brands and unlock the potential of our business.
“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.”
Some cool observations from Morning Brew newsletter:
Like your dad trying to make the mayo last longer, execs at Kraft Heinz said the current company was spread too thin with 56 different product categories.
Kraft Foods and HJ Heinz merged 10 years ago into the fifth-largest food and beverage company in the world:
• The union was spearheaded by legendary investor Warren Buffett and Brazilian investment firm 3G Capital.
• 3G was known for its brutal cost-cutting measures, and the new company laid off thousands of workers.
But investors say the belt-tightening over the last decade ultimately hurt the brand. While Kraft Heinz was staring at spreadsheets, other brands were rolling out less-processed, healthier products that customers wanted.
At the same time, cheaper store-brand products of nearly all Kraft Heinz roster items were booting name-brand products out of their shopping carts.
The company’s net revenue has fallen every year since 2020, and its stock price has declined by ~70% since the merger in 2015.
Even Buffett admitted the merger was a flop. He still doesn’t think splitting the company up is a good idea, though, due to the associated costs.
Big picture: The food and beverage industry as a whole is undergoing significant upheaval. Keurig Dr Pepper recently said it was splitting its coffee and drinks businesses, and Kellogg completed a great unwinding in October 2023.
Just this week, too, activist Elliott Investment Management took a $4-billion stake in PepsiCo to try to turn that puppy around, and on Monday, Nestlé’s (now ex) CEO stepped down after an investigation found that he was dating a subordinate.
Source: just-food.com, MorningBrew.com