For the first time, Kraft Heinz responds to the ongoing rumours about a split: according to CEO Carlos Abrams-Rivera, the multinational is indeed evaluating strategic options. A deal could be finalised within a few weeks.
20 billion dollars
Abrams-Rivera made his statements in a briefing on the group’s quarterly results. Kraft Heinz is considering to separate its brand portfolio, with Kraft being divested. The sauces, spreads, and seasonings of Heinz are performing much better. Sources close to the company expect that the mega deal, with an estimated value of twenty billion dollars (seventeen billion euros), could be finalised within a few weeks.
“We are working with urgency on an evaluation of those strategic options”, said Abrams-Rivera, who also emphasised that management is maintaining financial discipline at every step. According to a company statement, there can be no assurance that the assessment process will result in any transaction.
The merger between Kraft Foods and HJ Heinz in 2015, orchestrated by investors Berkshire Hathaway and 3G Capital, was one of the largest deals in FMCG history. However, it never really met the high expectations: rather, its revenue, margin, and stock price declined as economies of scale proved to be no answer to changing consumer expectations.
