Berkshire Hathaway Explores Selling $7.7bn Kraft Heinz Stake

Berkshire Hathaway is considering selling almost its entire $7.7bn stake in packaged food company Kraft Heinz, in a move that would end more than a decade of involvement with a group it had a key role in creating. Shares in Kraft Heinz fell sharply on Tuesday evening after it disclosed that Berkshire had registered the potential sale of up to 325.4mn shares in the company in a filing. Berkshire is Kraft Heinz’s largest investor with 325.6mn shares, a 27.5 per cent stake. Kraft Heinz said the filing “does not necessarily mean that the selling stockholder will choose to sell any shares”. The company’s shares were 5.1 per cent lower in pre-market trading early on Wednesday. Former Berkshire chief executive Warren Buffett and investment group 3G Capital took ketchup maker Heinz private in 2013 for $28bn. Two years later, they put together a $63bn deal to merge the company with Kraft. The investment has been poor for Berkshire, which is regarded as one of the world’s savviest investors, with Kraft Heinz shares having lost two-thirds of their value since 2015. Buffett later said he overpaid for Kraft, admitting he had been “wrong in a couple of ways”. He handed over the reins of Berkshire to Greg Abel on January 1. Kraft Heinz is in the process of splitting back into two companies. The deal would create one company with faster-growing brands such as Heinz ketchup and Philadelphia cream cheese, with the other company owning slower-selling grocery store staples. Buffett said previously that he was opposed to the split. The former company, which has the working title of Global Taste Elevation Co, will be headed by Steve Cahillane, who took over as Kraft Heinz chief on January 1. Cahillane formerly served as chief of Kellogg Co, overseeing its 2023 break-up into snacks company Kellanova and the North American breakfast cereal group WK Kellogg. He served as Kellanova’s chief until its sale to Mars, which closed in December.