McDonald’s cancels contract worth millions because of Heinz’ new CEO

Take-over and new CEO

Berkshire Hathaway, Warren Buffett’s investment fund, and Brazilian 3G
purchased Heinz earlier this year and one of their first acts was the appointment of a new CEO. That was
Bernardo Hees, former CEO for Burger King.

McDonald’s felt that was reason enough to terminate all worldwide contracts
with Heinz. “As a result of recent management changes at Heinz, we have decided
to transition our business to other suppliers over time”,
McDonald’s has stated. “We have spoken to Heinz and plan to work together to
ensure a smooth and orderly transition.” Heinz has refused to react to the
announcement of McDonald’s.

Heinz had already lost its American contracts with McDonalds in 1973 after
it had failed to attain certain supply goals. That was mainly due to a bad
tomato harvest, after which it decided
to service supermarkets first. Now it will lose all other McDonald’s
contracts, with Burger King deals still in place.

(translated by Gary Peeters)