Kraft Heinz to Split Into Two Companies in Bold Restructuring Shakeup

A Historic Breakup in the Food Industry

Kraft Heinz has announced a sweeping restructuring that will split the company into two independent businesses, one centered on grocery staples and another on global snacking. The decision marks one of the biggest shakeups in the packaged food industry in years, as the Pittsburgh and Chicago-based company seeks to revive growth and sharpen its focus.

The New Structure

Under the plan, Kraft Heinz will create:

1. Kraft Heinz North America Grocery Co. – Home to iconic pantry staples such as Heinz ketchup, Kraft macaroni and cheese, and Philadelphia cream cheese. This division will focus on core U.S. and Canadian grocery markets, emphasizing predictable cash flows and operational efficiency.
2. Kraft Heinz Global Snacking Co. – A separate entity with an international footprint, focusing on high-growth brands such as Lunchables, Planters nuts, and emerging snack categories. This company is expected to prioritize innovation, marketing, and expansion across fast-growing consumer segments.

Executives said the restructuring will give each business “greater strategic freedom” to pursue growth tailored to its strengths.

Why the Split Now?

The move comes amid intensifying competition from both legacy food giants and new entrants capitalizing on changing consumer preferences. Kraft Heinz, once valued at over $100 billion, has struggled in recent years with sluggish growth, rising input costs, and challenges in adapting to healthier eating trends.

By separating grocery staples from snacks, Kraft Heinz aims to:

• Unlock Shareholder Value – Investors often reward companies that narrow their focus, creating “pure play” businesses with clear identities.
• Sharpen Focus – Grocery staples will lean on scale and efficiency, while snacking will push innovation and global expansion.
• Boost Growth Potential – Snacking, one of the fastest-growing categories worldwide, will gain independence to pursue new markets.

Investor and Market Reaction

Shares of Kraft Heinz initially rose on news of the restructuring, reflecting investor optimism that the move could help unlock trapped value. Analysts noted that similar breakups in the food and beverage industry, such as Mondelez’s split from Kraft Foods in 2012, created strong results for shareholders.

“Investors want clarity, and this split provides that,” said one equity analyst. “Staples will be the steady ship, while snacks can chase growth.”

The Competitive Landscape

The split positions Kraft Heinz more directly against rivals:

• Kraft Heinz North America Grocery Co. will compete with General Mills and Kellogg’s in grocery aisles, focusing on brand heritage and operational scale.
• Kraft Heinz Global Snacking Co. will go head-to-head with Mondelez and PepsiCo’s Frito-Lay division, entering the global snacking race where innovation and speed-to-market are critical.

The snacking arm will face particular scrutiny as it seeks to capture a share of a booming market projected to grow at 6–8% annually over the next decade.

Risks Ahead

While the split offers opportunity, it also comes with challenges:

• Execution Risk – Carving one company into two requires complex operational and financial restructuring.
• Debt Allocation – How Kraft Heinz divides its debt burden could impact investor appetite.
• Brand Strength – Both entities will need to protect brand equity while navigating changing consumer preferences.

Despite these risks, executives remain confident. “We are creating two world-class companies with the agility and focus to thrive in their categories,” said Kraft Heinz CEO Carlos Abrams-Rivera.

Broader Industry Implications

Kraft Heinz’s decision may inspire similar moves across the sector. As consumer tastes shift and capital markets demand sharper strategies, food giants may increasingly separate legacy divisions from fast-growing categories to stay competitive.

The Bottom Line

Kraft Heinz splitting into two companies represents a bold bet on focus and flexibility. By creating a grocery staples powerhouse and a nimble global snacking player, the company hopes to unlock growth, deliver value to shareholders, and redefine its role in the evolving food industry.