US multinational food company Kraft Heinz has announced plans to split into two separate companies – one focused on sauces and spreads and the other on grocery staples and ready-to-eat meals.
The move was aimed at maximising the company’s capabilities and brands while reducing complexity, Kraft Heinz said on 2 September.
Formed by the merger of Kraft Foods Group and the HJ Heinz Company in 2015, Kraft Heinz’s portfolio includes leading brands such as Heinz ketchup, Lea & Perrins Worcestershire sauce and Philadelphia cream cheese.
According to Britannica Money, the company’s portfolio of more than 200 brands are produced and sold in more than 40 countries. Its main product categories can be broken down into five general segments:
- Condiments and sauces
- Cheese and dairy products
- Meals, snacks and meat products
- Drinks
- Other grocery items
Many Kraft Heinz products contain oils and fats, either as core ingredients or for texture, flavour and shelf stability. These products include cheese and dairy-based products; condiments, sauces and dressings; plant-based brands; and snacks and meals kits. Oils and fats used in Kraft Heinz products can include vegetable oils such as soyabean, canola and palm oils, animal fats, cocoa butter, dairy fats and emulsifiers derived from oils and fats.
Kraft Heinz said that the two new companies, whose names would be decided at a later date, would temporarily be called Global Taste Elevation Co and North American Grocery Co.
Global Taste Elevation Co would include a range of brands including, Heinz, Philadelphia and Kraft Mac & Cheese – with approximately 75% of its net sales from sauces, spreads and seasonings.
North American Grocery Co’s portfolio would include the Oscar Mayer, Kraft Singles and Lunchables brands.
“The complexity of our current structure makes it challenging to allocate capital effectively, prioritise initiatives and drive scale in our most promising areas,” said Miguel Patricio, executive Chair of the Board for Kraft Heinz.
“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 and the creation of long-term shareholder value.”
