The latest news, trends, analysis, interviews and podcasts from the global food and beverage industry

The Kraft Heinz Company has announced plans to split into two independent companies in a tax-free spin-off.

According to the company, the goal is to simplify operations and sharpen the strategic focus of its brands. The board of directors unanimously approved the move, which is expected to position both companies for stronger performance and long-term shareholder value.

The split will create:

• Global Taste Elevation Co: This company will focus on global sauces, spreads and shelf-stable meals. It includes big brands like Heinz, Philadelphia and Kraft Mac & Cheese. It expects around $15.4 billion in sales and $4 billion in profit in 2024. About 20% of its sales will come from emerging markets, and another 20% from restaurants and other foodservice channels.

• North American Grocery Co: This company will focus on staple food brands in the US and Canada, including Oscar Mayer, Kraft Singles and Lunchables. It expects about $10.4 billion in sales and $2.3 billion in profit in 2024. Most of its sales come from top-ranked brands. The company plans to grow efficiently while finding new opportunities for its products.

The move follows earlier reports that Kraft Heinz was considering divesting part of its grocery business in a potential $20 billion spin-off. The planned separation confirms the company is moving forward with restructuring to simplify operations and focus on its strongest brands.

Miguel Patricio, executive chair of the Kraft Heinz board, said the split will help each company focus more on its brands and use resources better. “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," he said.

Kraft Heinz CEO Carlos Abrams-Rivera will lead North American Grocery Co. A CEO for Global Taste Elevation Co is still being selected.

Abrams-Rivera said the move will “unleash the power of our brands” and thanked employees for their work.

The separation is expected to finish in the second half of 2026, after approvals from regulators and a tax review confirming the spin-off is tax-free. Kraft Heinz stated that additional details on company names, brand allocation, capital structure and board composition will be released closer to the completion of the transaction.