Core Viewpoint - Warren Buffett expressed disappointment over Kraft Heinz's split, which undermines the results of the significant merger he led a decade ago [2] Group 1: Company Performance - Berkshire Hathaway holds a 27.5% stake in Kraft Heinz, making it the largest shareholder [2] - Following Buffett's comments, Kraft Heinz's stock price fell by over 3% [2] Group 2: Historical Context - The merger between Kraft Foods and H.J. Heinz was facilitated by Berkshire Hathaway and private equity firm 3G Capital in 2015 [2] - 3G Capital has been gradually reducing its stake in Kraft Heinz over the years and quietly exited its investment in 2023 [2] Group 3: Future Outlook - Buffett indicated that Berkshire will act in the best interest of the company regarding its investment in Kraft Heinz [2] - He stated that Berkshire would not accept large block trade offers unless other shareholders receive the same price [2]

格隆汇9月2日｜食品巨头卡夫亨氏股价下跌3.7%。此前公司计划分拆为两家独立上市公司，巴菲特表 示他对卡夫亨氏的分拆感到"失望"。 ...

Core Viewpoint - Kraft Heinz is planning to split into two publicly traded entities by the latter half of 2026, reversing the 2015 merger, which has been criticized for its poor performance [2][3] Group 1: Industry Context - The spin-off reflects challenges in the packaged food industry, including stagnant demand, changing consumer preferences, and increased competition from private labels [3] - The stock price saw minimal change, increasing by only 1% in pre-market trading, while shares have decreased by 21% over the past year, indicating skepticism from investors [3] Group 2: Company Structure Post-Split - The new structure will consist of Global Taste Elevation Co., which includes higher-growth brands like Heinz and Kraft Mac & Cheese, and North American Grocery Co., focusing on U.S. staples like Oscar Mayer and Kraft Singles [4] - Pre-split, Kraft Heinz was trading at approximately 1.3× sales, lower than competitors like Mondelez (2.3×) and Kellanova (2.2×), but slightly above Conagra (1.0×) and Campbell Soup (1.1×) [5] Group 3: Financial Projections - Management anticipates a 60/40 revenue split between the two new entities, projecting Global Taste to generate around $16 billion and North American Grocery about $11 billion based on a 2024 run rate of $27 billion [6][7] - If Global Taste achieves Mondelez-like multiples of 2.0–2.3× revenue, its market cap could reach $32–$36.8 billion, while North American Grocery might trade at 1.0–1.1×, resulting in a combined value of $43–$49 billion, compared to Kraft Heinz's current valuation of $33 billion [7] Group 4: Market Considerations - The market typically does not assign top-tier multiples to both halves of a breakup; if Global Taste trades at 1.6–1.8× and North American Grocery at 1.0×, the total value could drop to $37–$40 billion [8] - The success of the split hinges on the ability of both companies to achieve consistent growth and restore investor confidence, with proponents viewing it as a chance for independent valuation and skeptics fearing it may expose deeper structural issues [9]

Centerview Partners has nabbed the key advisory role on the Kraft Heinz Co. breakup, unwinding a megamerger the boutique bank advised on more than a decade ago https://t.co/SUxS9afxZJ ...

Kraft Heinz Company Update Summary Company Overview - **Company**: The Kraft Heinz Company (KHC) - **Date of Call**: September 02, 2025 - **Key Focus**: Announcement of the separation into two distinct companies Core Points and Arguments 1. **Separation Announcement**: Kraft Heinz will separate into two focused companies: the Taste Elevation Company and the North America Grocery Company, aimed at improving performance and unlocking long-term value for shareholders [4][5] 2. **Growth Projections**: Historical industry growth in the U.S. is around 2%, with Taste Elevation categories expected to grow slightly faster at 2.5% to 3% [11][12] 3. **Strategic Review**: The decision to separate was influenced by a strategic review that highlighted the complexity of the current business structure, which hindered the ability to realize the full potential of brands and operations [15][16] 4. **Operational Efficiency**: The North America Grocery Company is expected to generate substantial free cash flow through operational efficiency in stable growth categories [5] 5. **Market Share and Growth**: Kraft Mac and Cheese remains with the Taste Elevation Company due to its strong market share (70%) and attractive margins, with a historical growth rate of 3% CAGR [21][22] 6. **Dissynergies**: The anticipated dissynergies from the separation are estimated at $300 million, primarily from cost of goods sold (COGS), IT costs, and sales and marketing expenses [24][25] 7. **Investment in Growth**: 85% of marketing investments are directed towards accelerated platforms in North America, indicating a strong commitment to driving growth in key areas [33] 8. **EBITDA Guidance**: For 2024, EBITDA is projected at $6.3 billion, with a slight decrease to $6 billion expected in 2025, indicating potential profit pressures [40][41] 9. **Focus on Innovation**: The company has doubled its rate of innovation over the last three years, with plans to continue enhancing product offerings and improving existing products [96][98] Additional Important Insights 1. **Capital Structure**: Both companies will target an investment-grade capital structure, allowing for flexibility in strategic transactions post-separation [55][56] 2. **Market Dynamics**: The Taste Elevation Company has faced recent sales declines (3-4%) due to low consumer sentiment, but historically has shown strong growth [30][32] 3. **Future Opportunities**: The North America Grocery Company is expected to explore food service expansion and other channels that have not been fully leveraged [80][81] 4. **Margin Expansion**: There is a greater opportunity for margin expansion in the North America Grocery Company compared to the Taste Elevation Company, with ongoing efforts to improve COGS and operational efficiencies [75][78] This summary encapsulates the key points discussed during the Kraft Heinz Company update call, highlighting the strategic direction and anticipated outcomes of the company's separation.

Kraft Heinz is planning to break up into two companies, undoing a merger that is just a decade old by splitting its North American grocery business from its sauces and spreads operations like Philadelphia cream cheese. https://t.co/AZruAvrX6W ...

Core Viewpoint - Kraft Heinz announced a split into two independent publicly traded companies, marking the end of the $46 billion merger led by Warren Buffett ten years ago, aimed at simplifying business structure and enhancing profitability in response to ongoing performance pressures and industry changes [1][3]. Group 1: Company Restructuring - The split will create a "Global Flavor Enhancements Company" focused on sauces, condiments, and ready-to-eat meals, and a North American grocery company centered on brands like Oscar Mayer and Lunchables [3][12]. - The transaction is expected to be completed in the second half of 2026, pending regulatory approval [3]. - The split is anticipated to incur approximately $300 million in additional operating costs, but the company commits to maintaining current dividend levels and aims to preserve its investment-grade credit rating [5]. Group 2: Market Context and Performance - Kraft Heinz's stock price has fallen by 21% over the past year, reflecting market concerns about its growth prospects [1]. - The company's market value has decreased by about 70% since its peak in 2017, with Buffett acknowledging multiple misjudgments regarding the investment [8]. - The restructuring reflects broader trends in the packaged food industry, where companies are adapting to changing consumer preferences for healthier, natural foods amid inflationary pressures [9][13]. Group 3: Industry Trends - The split of Kraft Heinz is part of a larger trend in the global packaged food industry, which is undergoing significant restructuring [9]. - Other companies, such as Kellogg and Mars, have also engaged in similar strategic separations and acquisitions to focus on high-growth categories [10][11].

Core Viewpoint - Kraft Heinz Company (KHC.US) announced a unanimous board decision to spin off into two independent publicly traded companies, aiming to simplify operations and enhance performance while maintaining competitive scale [1] Group 1: Spin-off Details - The spin-off will create two companies: Global Taste Elevation Co. and North American Grocery Co. [1] - The decision follows a strategic evaluation process that began in May, analyzing various paths before concluding on the separation [1] Group 2: Financial Implications - The spin-off is expected to provide both new companies with ample discretionary cash flow for organic growth, shareholder returns, and strategic opportunities [1] - The current dividend level is anticipated to remain unchanged, with management aiming to optimize capital structure to maintain investment-grade credit ratings for both entities [1] Group 3: Market Reaction - Kraft Heinz's stock has declined by 9% year-to-date, but it rose by 1.89% in pre-market trading to $28.50 following the announcement [1]

Kraft Heinz to Separate Into Two Publicly Traded Companies. Hear the details on the Bloomberg Stock Movers report. https://t.co/O5y0W8QQuf ...

Kraft Heinz Separation Overview - Kraft Heinz plans to separate into two independent companies: Global Taste Elevation Co and North American Grocery Co[4, 25] - The separation aims to allow each company to dedicate resources, reduce complexity, and align capital allocation with strategic ambitions[26, 27] - The spin-off is expected to be completed in the second half of 2026 and is expected to be tax-free to Kraft Heinz and its shareholders[66] Global Taste Elevation Co - Global Taste Elevation Co had net sales of $154 billion in 2024 and adjusted EBITDA of $40 billion[28] - More than 75% of net sales are from market-leading brands with approximately 90% U S household penetration[41] - The company has a 7% 5-year CAGR in Taste Elevation and a 10% 5-year CAGR in Away From Home organic net sales[43] North American Grocery Co - North American Grocery Co had net sales of $104 billion in 2024 and adjusted EBITDA of $23 billion[28] - Nearly 75% of net sales are from market-leading brands[53] - The company has an opportunity to pursue whitespace in Away From Home, with industry average Away From Home sales at 19% compared to the company's 4%[57] Strategic Rationale - Portfolio complexity is correlated to lower growth rates[22] - The separation will minimize operational overlap and replication, with anticipated dis-synergies of up to $300 million, a substantial portion of which can be mitigated in the near term[58] - The company realized annual efficiencies of approximately $35 million from 2022 to 2024 through shared services efficiencies[13]