Kraft Heinz has decided to halt its plans for a separation into two distinct entities, effectively scrapping the initiative to dismantle the significant merger that took place a decade ago under the guidance of Warren Buffett and 3G Capital. Steve Cahillane, the company’s newly appointed chief executive officer, announced on Wednesday that the potential opportunities ahead for Kraft Heinz were “larger than expected.” In a notable move, he outlined intentions to invest $600 million aimed at revitalizing the firm, which is known for its popular products like Heinz ketchup and Philadelphia cheese.
Cahillane emphasized that his primary focus is to steer the company back towards profitable growth, asserting that the challenges faced by Kraft Heinz are largely manageable and within the company’s control. Despite this optimistic outlook from leadership, the company’s stock fell by 3 percent in early trading on the same day.
Analyst Robert Moskow from TD Cowen highlighted that the decision to abandon the split suggests that Kraft Heinz’s divisions are not robust enough to thrive independently, raising questions about their future viability. The reversal of the split plan comes mere months after its initial announcement and only weeks after Cahillane took the reins from Kellanova.
The breakup plan was initially proposed as a strategy to awaken stagnant sales within Kraft Heinz, which stemmed from the merger of Kraft and Heinz in 2015. The intention was to delineate the group’s lower-growth grocery lines, including brands like Oscar Mayer and Lunchables, from the more dynamic sectors focused on sauces, spreads, and seasonings.
Investor sentiment about the plan was largely negative, with Buffett himself calling the breakup “disappointing” in a CNBC interview following the announcement last September. Berkshire Hathaway, which holds a significant 28 percent stake in Kraft Heinz, indicated in a recent filing that it is contemplating a sale of its shares in the struggling packaged food company.
On the financial front, Kraft Heinz recently reported disappointing quarterly results, with a 3.4 percent drop in net sales to $6.4 billion in the last quarter of 2025 and a staggering 70 percent decrease in net profit, which fell to $648 million. Prior to the cessation of the break-up plans, former CEO Carlos Abrams-Rivera was slated to lead the grocery staples division, but he was replaced by Cahillane at the start of this year. Initially, Cahillane had intended to oversee the sauces and spreads division, referred to as the Global Taste Elevation Company, after the proposed separation.
With the announcement of the $600 million investment, Cahillane outlined plans for the funds to be directed towards marketing, sales, and research and development. These efforts are expected to enhance the existing momentum already noted in the Taste Elevation portfolio and facilitate the rebound of the company’s business in the United States.
