Kraft Heinz is reportedly moving closer to a major corporate restructuring that would split the company into two separate units, according to the Wall Street Journal, citing people familiar with the matter. The proposed transaction, which would create one division focused on grocery products and another on sauces and condiments, could be finalized and publicly announced as soon as next week.
The move represents a significant strategic shift for the iconic consumer packaged goods company, which was formed in 2015 when Warren Buffett’s Berkshire Hathaway and Brazilian private equity firm 3G Capital merged the former Kraft Foods with H.J. Heinz, acquired by the same investors in 2013. Berkshire Hathaway recently left Kraft Heinz’s board in May, a development that some analysts say may have cleared the way for more aggressive strategic maneuvers.
Back in July, Kraft Heinz began exploring the possibility of a spinoff of a substantial portion of its grocery business, including many of the Kraft-branded products. Early reports suggested the new grocery entity could carry a standalone valuation of up to $20 billion, creating an opportunity to unlock shareholder value. Later that month, the company confirmed it was “working with urgency” to evaluate strategic options for its portfolio of brands.
The split, if completed, would leave Kraft Heinz with its core condiment and sauces lineup, including Heinz ketchup and the premium mustard brand Grey Poupon, while the grocery-focused spinoff would operate independently, potentially attracting investors seeking exposure to the broader packaged food market. The company is reportedly betting that the combined value of the two separate entities would exceed its current market capitalization of roughly $33 billion, although sources cautioned that plans and timing could still shift before a final announcement.
Kraft Heinz’s recent financial performance may have played a role in the decision. In late July, the company reported a quarterly earnings beat, driven by resilient demand for pantry staples and condiments in the U.S., signaling that its brands retain strong consumer appeal despite broader challenges in the packaged foods industry. Shares of Kraft Heinz responded positively to the news, climbing about 2% in afternoon trading on Friday following the Wall Street Journal report.
If executed, the split would mark one of the most notable corporate restructurings in the food sector in recent years, reflecting a broader trend among consumer goods companies to unlock value through spinoffs and portfolio realignment. Analysts will be closely watching the official announcement, expected as early as next week, for details on the structure, leadership, and potential market impact of the two separate Kraft Heinz units.
Kraft Heinz did not immediately respond to a Reuters request for comment.
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