According to the Wall Street Journal, which cited people close to the situation, the transaction could be finalized and announced this week.
Kraft Heinz CEO Carlos Abrams-Rivera said in May of this year, that the firm has been exploring potential “strategic transactions” as part of a wider effort to “drive profitable long-term growth and value creation”.
“We have been evaluating potential strategic transactions to unlock shareholder value,” he added.
Reports emerged in the Wall Street Journal in July that a spinoff was likely, shortly after Kraft Heinz agreed to the sale of its Italian baby and specialty food business to NewPrinces Group.
Under the plan, a large portion of its grocery business, including many Kraft products, would be made into a new entity that could be valued at as much as $20 billion, while the sauce division will continue to operate as a separate business.
Kraft Heinz did not immediately respond to Food Manufacture’s request for comment.
Formed in 2015 after Berkshire Hathaway and Brazilian private equity firm 3G Capital combined the Kraft Foods with H.J. Heinz, Kraft Heinz owns brands in the UK such as Heinz, Amoy, Daddies and HP Sauce, as well as US brands including Capri Sun, Oscar Mayer and Philadelphia.
Speaking to Food Manufacture about the situation at Kraft Heinz, food sector analyst and director at Wilkin Chapman Rollits, Julian Wild, said that the firm was hoping to sell off “non-strategic businesses” and “looking to buy into areas where they would like to be more prominent, for example, healthier products, playing to the weight-loss market”.
“There is clearly shareholder pressure to move these plans along quicker but it is a bit like turning round a super tanker,” Wild added.
