(Reuters)-Kraft Heinz said on Tuesday that it will be divided into two publicly traded companies, one focused on sauce business and the other in grocery products, as the US-packed product manufacturer intends to revive growth after years of weak sales.
The first company, called “Global Taste Elevation Co”, will house brands such as Heinz, Philadelphia and Kraft Mac & Cheese, while the other, called “North American Grocery Co”, will consist of Oscar Mayer, Kraft Singles and Lunchables brands.
The sauces unit raised about $ 15.4 billion in sales in 2024, while the grocery business generated about $ 10.4 billion in sales.
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“Kraft Heinz brands are iconic and worshiped, but the complexity of our current structure makes it difficult to effectively allocate capital, prioritize initiatives and increase scale in our most promising areas,” said Miguel Patricio, executive chairman of the Kraft Heinz Council.
The company expects the separation to be completed in the second half of 2026.
Kraft Heinz said in May that it was looking for mergers and acquisition opportunities to increase the value for shareholders. The company has been facing difficulties, as well as other packed food companies, as consumers seek healthier and more affordable spices and snacks.
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The company’s shares rose about 1% in pre-market negotiations. The shares have lost about 21% of their value in the last twelve months.
