Kraft Heinz to Split in Strategic Shake-Up Creating Global Taste and North American Grocery Giants

Kraft Heinz, a prominent U.S. packaged food company, announced on Tuesday its plan to split into two publicly traded entities in a strategic move aimed at reinvigorating growth, which has been stagnant in recent years. The separation will create distinct focuses for the two companies: one dedicated to sauces and the other to grocery products.

The newly formed "Global Taste Elevation Co" will encompass brands such as Heinz, Philadelphia, and Kraft Mac & Cheese, while "North American Grocery Co" will manage product lines including Oscar Mayer, Kraft Singles, and Lunchables.

Kraft Heinz's executive chairman, Miguel Patricio, emphasized the iconic nature and consumer appeal of the company's brands but noted the current corporate structure's complexity hampers effective capital allocation, strategic prioritization, and scaling efforts in promising areas.

The company foresees the tax-free spin-off transaction concluding by the latter half of 2026. Earlier, in May, Kraft Heinz expressed intentions to explore mergers and acquisitions to safeguard shareholder value amid mounting pressures similar to other packaged food companies, driven by a consumer preference shift towards healthier and more cost-effective condiments and snacks.

In premarket trading, Kraft Heinz's stock saw a modest increase of approximately 1%, though it has experienced a decline of about 21% over the past 12 months.