Aisle See You Around

Heinz and Kraft decide to split after ten years together

The power couple of American grocery lore decided they're better off alone. Since their founding, Heinz (1859, Pittsburgh) and Kraft (1909, Chicago) represent two of the most steadfast food manufacturers in the nation. They merged in 2015 under the near-spotless advisory of Warren Buffett. Turns out, they weren't made for each other, as the Kraft Heinz Company announced September 2 that it will separate into two independent, publicly traded companies through a tax-free spin-off.

"The separation is designed to maximize Kraft Heinz’s capabilities and brands while reducing complexity, allowing both new companies to more effectively deploy resources toward their distinct strategic priorities," read a Kraft-Heinz press release from the same day. "This focus will enable stronger performance while preserving the scale to compete and win in today’s environment," it continued.

Like all breakups, it's tricky. As you'll see below, the Kraft brand will appear in both new companies. The two entities' "names will be determined at a later date," according to the press release...although it offered some appetizers:

• “Global Taste Elevation Co.” – This company will reportedly include a roster of Heinz, Philadelphia and Kraft Mac & Cheese – with approximately 75% of net sales coming from sauces, spreads and seasonings.

• “North American Grocery Co.” – a scaled portfolio of North America staples with approximately $10.4 billion in 2024 net sales. This company, which will be led by Carlos Abrams-Rivera, will include a portfolio of beloved brands, including three billion-dollar brands – Oscar Mayer, Kraft Singles and Lunchables.

“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 for 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. I look forward to working closely with Carlos and the Kraft Heinz team in the months ahead to prepare the organization for the separation.”