MW Kraft-Heinz's stock jumps after report of breakup plan

By James Rogers and Tomi Kilgore

The packaged-foods giant is planning a breakup that could see the spinoff of much of its grocery business, per WSJ

Shares of Kraft-Heinz Co. spiked higher before paring gains Friday, following a report that the packaged-foods giant is planning a breakup.

Citing people familiar with the matter, the Wall Street Journal reported that the company $(KHC)$ is looking to spin off a large chunk of its grocery business. The spinoff would include many Kraft products, and the new entity could be valued at as much as $20 billion, according to the Journal.

"As announced in May, Kraft Heinz has been evaluating potential strategic transactions to unlock shareholder value," a spokesperson for Kraft-Heinz told MarketWatch in a statement. "Beyond that, we do not comment on rumors or speculation."

The stock traded in negative territory for most of the day, then spiked higher to a gain of as much as 4.2% soon after the Journal's report published. It subsequently pared gains and was up 1.2% in afternoon trading, at last check.

The company, which is known for its ketchup and brands like Capri-Sun, lowered its full-year outlook in May amid what it described as a "volatile" operating environment. Kraft-Heinz's results marked the eighth straight quarter that top-line numbers missed expectations.

Shares of Kraft Heinz, which was itself born out of a 2015 merger between Kraft Food and Heinz, have fallen 12.8% this year, compared with the S&P 500 index's SPX gain of 6.5%.

Since the merger was completed in July 2015, Kraft Heinz's stock has tumbled 69.6%, while the Consumer Staples Select Sector SPDR ETF XLP has climbed 67.5% and the S&P 500 has run up nearly 202%.

Kraft-Heinz would not be alone in pursuing the breakup route to boost shareholder value. Earlier this year, for example, Honeywell International Inc. (HON) split into three companies in an effort to boost shareholder returns.

And last year, entertainment giant Comcast Corp. (CMCSA) said that it was considering spinning off its cable networks.

The idea is that parts of a conglomerate can be worth more than the whole, because investors may prefer to bet on pure plays on certain industries rather than having to factor in exposure to unwanted trends. Investors who hold their shares through the breakup would basically be paid the difference between the whole and the parts.

-James Rogers -Tomi Kilgore

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July 11, 2025 14:55 ET (18:55 GMT)

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