Kraft Heinz Sells Coffee Unit
The food giant is divesting its North America coffee business to One Rock Capital Partners for $650 million as part of CEO Steve Cahillane's turnaround effort
Kraft Heinz is selling its North America coffee unit to One Rock Capital Partners for an enterprise value of $650 million. The company will retain a 30% non-controlling equity stake in the coffee unit, which includes brands such as Maxwell House, Gevalia and Ethical Bean.
The divestiture is expected to close in mid-2027 and is part of CEO Steve Cahillane's turnaround effort. Cahillane has been working to revamp the company since taking the helm in January, and this move is seen as a key step in that process.
Kraft Heinz's coffee unit is a significant part of the company's business, but the company has been looking to focus on other areas. The company has overseen a $700 million uptick in spending on marketing and innovation, with a focus on protein-heavy foods and electrolyte-infused drinks to attract health-conscious consumers.
The company's quarterly results, also released on Wednesday, showed a decline in net sales of nearly 2% to $6.12 billion. However, the results edged past estimates of $6.09 billion, according to data compiled by LSEG.
The sale of the coffee unit is a significant move for Kraft Heinz, and is seen as a key part of Cahillane's plan to turn the company around. The company had previously planned to split into two businesses, one focused on groceries and the other on sauces and spreads, but Cahillane postponed those plans soon after taking the helm.
## What happens next The divestiture is expected to close in mid-2027, and Kraft Heinz will retain a 30% non-controlling equity stake in the coffee unit. The company will continue to focus on its other businesses, including its protein-heavy foods and electrolyte-infused drinks.
The sale of the coffee unit is a significant move for Kraft Heinz, and is seen as a key part of Cahillane's plan to turn the company around. The company's focus on health-conscious consumers and its increased spending on marketing and innovation are expected to be key drivers of growth in the coming years.
The company's stock was up about 3% in premarket trading, following the announcement of the sale and the quarterly results. The sale of the coffee unit is seen as a positive move for the company, and is expected to help Kraft Heinz focus on its core businesses and drive growth in the coming years.
## Why it matters The sale of the coffee unit is a significant move for Kraft Heinz, and is seen as a key part of Cahillane's plan to turn the company around. The company's focus on health-conscious consumers and its increased spending on marketing and innovation are expected to be key drivers of growth in the coming years. The sale of the coffee unit will allow Kraft Heinz to focus on its core businesses and drive growth in the coming years.
