Kraft Heinz splitting into dual companies — as billionaire investor Warren Buffett knocks the move

Core Viewpoint - Kraft Heinz announced plans to split into two separate companies, a decision met with disappointment from major shareholder Warren Buffett, who previously facilitated the merger a decade ago [1][8]. Company Structure - The split will create a $10 billion North America grocery business, including brands like Oscar Mayer and Kraft Singles, and a $15 billion global business focused on "taste elevation" with products such as Heinz ketchup and Kraft Mac & Cheese [3][4]. - Kraft Heinz aims to enhance brand performance by allocating appropriate resources and attention to each brand [4]. Financial Performance - Since the merger in 2015, Kraft Heinz has lost approximately $57 billion in market value [7][11]. - The company reported a loss in its second quarter due to a $9.3 billion noncash impairment charge, primarily linked to declining sales of certain products [9]. Historical Context - Kraft Heinz was formed in 2015 through a $31 billion merger orchestrated by Berkshire Hathaway and 3G Capital [6]. - 3G Capital has since exited its investment in Kraft Heinz, while Berkshire Hathaway has maintained its stake [6]. Market Trends - The food industry has seen low success rates for megamergers, with smaller portfolios often yielding better long-term results [14]. - Recent industry movements include Kellogg's split into two entities and Keurig Dr Pepper's plans to unwind its merger [14][15].