Kraft Heinz Shares Fall Over 6% on Plan to Split Company in Two
The food giant will separate into two publicly traded entities, effectively reversing its landmark 2015 merger to create more focused businesses.
Kraft Heinz (KHC) saw its shares decline by more than 6% after the company by the second half of 2026. The move marks a significant strategy reversal, undoing the high-profile merger of Kraft and Heinz that took place in 2015.
The separation will create two distinct entities with focused brand portfolios. One company, tentatively called 'Global Taste Elevation Co.', will manage brands like Heinz ketchup, Kraft Mac & Cheese, and Philadelphia Cream Cheese. The second, 'North American Grocery Co.', will oversee a portfolio of staples including Oscar Mayer, Kraft Singles, and Lunchables. The transaction is intended to be tax-free for shareholders.
In a statement, Kraft Heinz Executive Chair Miguel Patricio explained that the split aims to simplify operations and allow for more effective resource allocation. "By separating into two companies, we can allocate the right level of attention and resources to unlock the potential of each brand to drive better performance," he said. The decision was met with immediate investor concern, with the stock falling 6.7% on the news, reflecting uncertainty around the strategic shift.
This move by Kraft Heinz reflects a broader trend in the consumer goods sector, where large conglomerates are breaking up to create more agile and specialized businesses. This trend has been seen with other giants like Kellogg's and Unilever, who have also spun off major divisions. created a complex structure that proved difficult to manage, and this separation aims to correct that.
The company confirmed that both new entities will maintain headquarters in Chicago and Pittsburgh. Further details on the leadership, names, and capital structures of the new companies will be released closer to the transaction's completion, which is subject to regulatory and tax approvals. by allowing each business to pursue its own distinct strategic priorities.