A major deal to be felt around the world, H.J. Heinz and Kraft Foods Group will merge into a single food behemoth forming the world’s fifth largest food and drink company, bent on cutting costs, growing internationally and evolving into a more consumer-focused company.
News of recently-planned Kraft Heinz Co. propelled Kraft shares nearly 35%, in late afternoon trading.
The gigantic merger, initially valued at around $36 billion, will allow Kraft “to move and grow faster than we could on our very own,” said Kraft CEO John Cahill, in conference call. He’d become vice-chair of the just-formed Kraft Heinz Co.
The firms said the boards of directors of both companies unanimously approved the deal. The brand new company will be co-headquartered in the Chicago region as well as in Pittsburgh, without any plans to shut either operation.
The top cheese behind this one is investor extraordinaire Warren Buffett, whose Berkshire Hathaway linked with 3G Capital to finalize the deal.