We had expected in September that the current CEO would lead one of the two new companies, specifically the one that is the grocery staples. They actually don't have official names yet, but that was a collection of the least profitable or less profitable food items there, including things like Lunchables and Oscar Mayer deli meats. The surprise came this morning that he is, in fact, not going to lead that company.And instead they are bringing in Steve Cahillane from Kilonova to lead the second company after ...

We had expected in September that the current CEO would lead one of the two new companies, specifically the one that is the grocery staples. They actually don't have official names yet, but that was a collection of the least profitable or less profitable food items there, including things like Lunchables and Oscar Mayer deli meats. The surprise came this morning that he is, in fact, not going to lead that company.And instead they are bringing in Steve Cahillane from Kilonova to lead the second company after ...

Company Overview - Kraft Heinz will split into two companies, reversing much of the $46 billion merger from a decade ago that created one of the largest food companies globally [1] - The split aims to enhance capital allocation, prioritize initiatives, and drive scale in promising areas, according to Miguel Patricio, executive chair of the board [4] New Company Structure - The first new company will focus on shelf-stable meals, including brands like Heinz, Philadelphia, and Kraft mac and cheese, projected to have $15.4 billion in net sales for 2024, with approximately 75% of sales from sauces, spreads, and seasonings [2] - The second new company will consist of a "scaled portfolio of North America staples," including Oscar Mayer, Kraft singles, and Lunchables, with an estimated $10.4 billion in net sales for 2024 [3] Historical Context - The merger that created Kraft Heinz in 2015 was initiated by Berkshire Hathaway and 3G Capital, initially well-received by investors, but faced challenges as U.S. sales declined [4] - The company faced significant issues, including a subpoena from the SEC regarding accounting policies, a 36% dividend cut, and a $15.4 billion write-down on major brands [5] - Following these challenges, Kraft Heinz underwent leadership changes, additional write-downs, and divestitures of certain business units, including its cheese unit and nuts division [6] Industry Trends - The split aligns with a broader trend in the food industry, where companies are pursuing breakups to divest from slower-growth categories and enhance investor appeal [7] - Other companies, such as Keurig Dr Pepper and Kellogg, have also pursued similar strategies to separate their business units for better performance [7]