Kraft Heinz Mulls $20B Split to Revive Growth
Kraft Heinz is considering a sweeping corporate restructuring that could unwind its landmark 2015 merger, as the packaged food giant seeks to restore growth and regain investor confidence.
According to a source familiar with the matter, the company is considering the spinoff of a significant portion of its grocery portfolio, including legacy brands such as Velveeta and Oscar Mayer, into a separate publicly traded entity. First reported by The Wall Street Journal, the potential deal could be valued at up to $20 billion, making it one of the year’s largest in the consumer goods sector.
Kraft Heinz declined to comment on the report.
The proposed move would mark a dramatic reversal of the $45 billion merger between Kraft Foods and H.J. Heinz, which was orchestrated by Warren Buffett’s Berkshire Hathaway. Though initially intended to streamline operations and expand globally, the combined company’s stock has dropped by nearly two-thirds since the merger.
Changing consumer preferences have compounded Kraft Heinz’s challenges, as U.S. shoppers increasingly turn away from processed foods, especially amid higher prices. The company has also faced criticism from advocates of the Make America Healthy Again (MAHA) movement, led by Health Secretary Robert F. Kennedy Jr., targeting products like Lunchables.
In May, Kraft Heinz acknowledged it was “evaluating potential strategic transactions to unlock shareholder value.” That announcement followed the departure of Berkshire Hathaway’s board representatives, which some analysts viewed as a vote of no confidence in the company’s future.
Should the split move forward, Kraft Heinz’s 200 brands would likely be divided between two groups. One unit, anchored by Heinz ketchup and Philadelphia cream cheese, would concentrate on condiments and spreads—an area with more robust growth.
