Nearly 10 years after its $46 billion megamerger, Kraft Heinz is breaking up into two standalone businesses, marking a dramatic reversal for the food giant that once sought to dominate grocery aisles worldwide.
The first company will house sauces, spreads, seasonings, and shelf-stable meals, including some of Kraft Heinz’s most iconic brands such as Heinz ketchup, Philadelphia cream cheese, and Kraft Mac & Cheese. With nearly $15 billion in annual sales, the new entity’s leadership has yet to be announced.
The second company will focus on grocery staples, including Oscar Mayer, Kraft Singles, and Lunchables. Current Kraft Heinz CEO Carlos Abrams-Rivera will lead this business, which will generate about $10 billion annually.
The move follows years of challenges for Kraft Heinz, as consumers shifted away from processed foods toward healthier options. The company has also struggled with inflationary pressures and changing consumption patterns driven by the rise of GLP-1 weight-loss drugs. Shares have dropped about 60% since the merger, with a $15.4 billion write-down on Kraft and Oscar Mayer announced in 2019.
Kraft Heinz Chairman Miguel Patricio said the split would simplify operations and allow sharper investment focus. “The complexity of our current structure makes it challenging to allocate capital effectively,” he said. “By separating, we can give each company the attention and resources it needs to drive growth and long-term shareholder value.”
The breakup, expected in the second half of 2026, mirrors broader industry trends. Kellogg split into two companies in 2023, while Keurig Dr Pepper recently announced a deal to acquire and later break up JDE Peet’s.
Still, Warren Buffett, whose Berkshire Hathaway owns 27.5% of Kraft Heinz and was instrumental in the 2015 merger, expressed disappointment at the decision to unwind the deal.
Both new companies will face ongoing pressure to innovate and adapt to consumer demands for healthier, cleaner-label products. Names for the spin-offs have not yet been disclosed.