Carlos Abrams-Rivera said in a statement on 20 May that the food giant’s board of directors and executive leadership team had been assessing the market as part of an effort to “drive profitable long-term growth and value creation”.
“Consistent with this goal, over the past several months we have been evaluating potential strategic transactions to unlock shareholder value,” added Abrams-Rivera.
“As we look to the future, we will continue to inspire and delight consumers with our iconic brands, fulfilling our mission.”
The firm will continue with its evaluation moving forward, but said that there was no guarantee the process would result in any transaction. There is no timetable set on this process and no further announcements are scheduled unless news arises.
Kraft Heinz owns a wide range of food and drink brands that operate all over the world, including in the UK where it has Heinz, Amoy, Daddies and HP Sauce. Its portfolio in the US also features brands such as Capri Sun, Oscar Mayer and Philadelphia.
Reacting to the news, Julian Wild – food sector analyst and director at Wilkin Chapman Rollits – told Food Manufacture that Kraft Heinz was not giving anything away at this stage.
“Inevitably it will mean that they look to sell off non-strategic businesses and look to buy into areas where they would like to be more prominent, for example, healthier products, playing to the weight-loss market,” Wild said.
“There is clearly shareholder pressure to move these plans along quicker but it is a bit like turning round a super tanker. Do not expect anything to happen quickly.”
Mark Field, CEO at Prof Consulting Group, added that the announcement reinforces the shifts occurring within the food sector towards healthier and better value products.
“Whilst I interpret this as it could mean a divesting of one or some of the brands, there is a clear message that they are looking at M&A options or acquisition targets,” Field said.
“This is interesting as the scale and market reach of KHC behind an existing business winning with today’s changing consumer could have a major impact on a category through ability to scale, innovate or promote, making the products household names and highly accessible.
“Although the information is limited at present the clear message is they are looking and the business could change to realign for future growth, an exciting space to watch develop further.”
Alongside the announcement about its M&A possibilities, Kraft Heinz said that representatives from shareholder Berkshire Hathaway would no longer sit on its board.
As such, Timothy Kenesey and Alicia Knapp have stepped down from the board, reducing it to 10 members. Kraft Heinz reiterated that the decisions were not the result of any disagreement with management.
“On behalf of the board, I’d like to thank Tim and Alicia for their commitment and contributions to Kraft Heinz over the years,” said board chair Miguel Patricio.
“We greatly value our strong history with Berkshire Hathaway and look forward to continuing our relationship.”
