(BRK.A), (BRK.B)
The Kraft Heinz Company (Nasdaq: KHC) has announced plans to separate into two independent, publicly traded companies through a tax-free spin-off. The move, unanimously approved by its Board of Directors, is aimed at simplifying operations and unlocking long-term growth by giving each business sharper focus and resources aligned with its strategy.
The two new entities will be:
Global Taste Elevation Co. – A global leader in sauces, spreads, seasonings, and shelf-stable meals with about $15.4 billion in 2024 net sales and $4.0 billion in adjusted EBITDA. Its portfolio will include Heinz, Philadelphia, and Kraft Mac & Cheese, with strong positions in both emerging markets and the Away From Home segment.
North American Grocery Co. – A North America-focused portfolio of grocery staples with $10.4 billion in 2024 net sales and $2.3 billion in adjusted EBITDA. Led by current CEO Carlos Abrams-Rivera, the business will feature well-known brands such as Oscar Mayer, Kraft Singles, and Lunchables, generating steady cash flow and pursuing growth in core and adjacent categories.
Executive Chair Miguel Patricio said the separation will reduce complexity and allow each company to better allocate capital, focus on growth, and deliver long-term shareholder value. Abrams-Rivera added that the move “will unleash the power of our brands and unlock the potential of our business.”
Kraft Heinz emphasized that both companies are expected to maintain investment-grade capital structures, preserve the current dividend level, and retain financial flexibility for organic growth, shareholder returns, and strategic opportunities.
The separation follows a strategic review launched in May 2025, with the company concluding that creating two standalone businesses provides the best path to maximize value for shareholders.
© 2025 David Mazor
Disclosure: David Mazor is a freelance writer focusing on Berkshire Hathaway. The author is long in Berkshire Hathaway, and this article is not a recommendation on whether to buy or sell the stock. The information contained in this article should not be construed as personalized or individualized investment advice. Past performance is no guarantee of future results.