Kraft Heinz may split into two

By: Trademagazin Date: 2025. 07. 11. 11:36

Kraft Heinz, one of the world’s most well-known food companies, is preparing for a major transformation. The company’s management plans to spin off its Kraft brand products into a separate company, the Wall Street Journal learned from several sources familiar with the matter. The value of the newly created company is estimated at about $20 billion, and the separation will give the group the opportunity to pursue a more focused business strategy.

Separation along growth paths

The decision is based on the fact that Kraft Heinz’s various business units are developing along significantly different market dynamics. While classic food categories – such as cheese and staple foods – are stagnating, the sauces, dressings and spreads segment is producing spectacular growth. The separation would allow the new company – which would operate under the Kraft brand – to focus on basic foods, while the remaining part of Kraft Heinz would focus on the faster-growing sauce and condiment market, with brands such as Heinz ketchup, Dijon mustard and various barbecue sauces.

Independent strategies, targeted operations

Separate operations will allow the two companies to tailor their operations, product development and marketing to their own consumer target groups and market challenges. The strategic goal of the separation is for both companies to be able to respond more effectively to changes affecting the food industry – be it inflationary pressures, health awareness or government regulations.

The market is cautiously optimistic

The announcement has triggered mixed reactions on financial markets: some investors are optimistic about the separation, which they believe could increase sales efficiency and, in the long term, the exchange rate. Others, however, have warned of the risks of the transaction: the separation could pose a significant organizational and cost burden, while also causing temporary market uncertainty.

No artificial colors

The transformation is not only structural but also product strategy-wise. Kraft Heinz announced that it will not launch new products with artificial colors in the United States starting in 2025 and will gradually eliminate synthetic colors from its existing products by the end of 2027. The move is part of the company’s health-conscious shift in response to consumer demand for more natural, “clean label” foods.