Kraft Heinz Announces Strategic Split into Two Companies by 2026

Kraft Heinz Co. announced on September 2, 2025, its plan to split into two independent, publicly traded companies, aiming to enhance growth and shareholder value. The separation is expected to be completed in the second half of 2026.

The first entity, tentatively named "Global Taste Elevation Co.," will focus on condiments, sauces, and spreads, encompassing brands such as Heinz, Philadelphia, and Kraft Mac & Cheese. This division is projected to generate approximately $15.4 billion in net sales for 2024. The second entity, referred to as "North American Grocery Co.," will concentrate on grocery staples, including brands like Oscar Mayer, Kraft Singles, and Lunchables, with an expected $10.4 billion in net sales for 2024.

Executive Chair Miguel Patricio stated that the current corporate structure complicates effective capital allocation and scaling in high-potential areas. By creating two focused companies, Kraft Heinz aims to streamline operations and better address evolving consumer preferences.

This strategic move follows the 2015 merger of Kraft and Heinz, which faced challenges due to shifting consumer trends toward healthier, less-processed foods. The split reflects a broader industry trend of companies restructuring to adapt to changing market dynamics.

Kraft Heinz's stock has declined approximately 21% over the past year, highlighting the urgency for strategic realignment.

Carlos Abrams-Rivera, the current CEO of Kraft Heinz, will lead the North American Grocery Co. The company is actively seeking a new CEO for the Global Taste Elevation Co.

The decision to split mirrors similar moves by other major food companies, such as Kellogg and Keurig Dr Pepper, who have restructured to better align with changing consumer preferences and market conditions.

Warren Buffett, whose Berkshire Hathaway holds a significant stake in Kraft Heinz, expressed disappointment with the decision, doubting that the breakup alone will resolve long-standing issues.

The separation is designed to maximize Kraft Heinz's capabilities and brands while reducing complexity, allowing both new companies to more effectively deploy resources toward their distinct strategic priorities. This focus will enable stronger performance while preserving the scale to compete and win in today’s environment.

The tax-free spinoff is expected to be completed in the second half of 2026. Kraft Heinz has no plans to change its current headquarter locations in Chicago and Pittsburgh.

This move marks a significant shift in Kraft Heinz's strategy, aiming to better position the company in a rapidly evolving food industry landscape.