A Strategic Shift: Berkshire Hathaway Exits Major Kraft Heinz Stake

Kraft Heinz US5007541064

In a significant portfolio move, Berkshire Hathaway has initiated the sale of its entire 27.5% stake in Kraft Heinz. The position, comprising approximately 325 million shares valued at around $7.3 billion, is being unwound following years of challenges and a substantial write-down recorded in the summer of 2025. This decision, made under the leadership of new Berkshire CEO Greg Abel who assumed the role in early 2026, coincides with Kraft Heinz embarking on its own radical corporate split.

Parallel to Berkshire's divestment, the food giant is undergoing a fundamental transformation. The company announced in September 2025 its plan to separate into two independent publicly traded entities, with the transaction expected to be completed in the second half of 2026.

The new structure will create:
* Global Taste Elevation Co.: This entity will house higher-growth global brands, including Heinz, Kraft Mac & Cheese, and Philadelphia. It is projected to generate annual net sales of approximately $15.4 billion.
* North American Grocery Co.: Focused on cash flow generation in a mature market, this company will bundle iconic U.S. brands such as Oscar Mayer, Lunchables, and Kraft Singles, with forecasted revenues of about $10.4 billion.

Steve Cahillane, who became Kraft Heinz's Chief Executive Officer in January 2026, will lead the international Global Taste Elevation Co. following the separation.

Market Reaction and Valuation Context

The filing of the sale notice by Berkshire Hathaway in late January 2026 initially placed downward pressure on Kraft Heinz's share price. The stock fell to a weekly low near $22.40 before recovering slightly to $23.28 by Friday.

The company's valuation metrics present a complex picture. On a GAAP basis, the price-to-earnings (P/E) ratio stands at a negative 6.4. This is directly attributable to a massive $9.3 billion impairment charge taken in 2025, which pushed the company into a reported accounting loss for that period.

However, analysts at Morningstar suggest focusing on adjusted earnings, which paint a different operational reality. Based on these adjusted figures, the forward P/E ratio for 2026 is estimated to be in the range of 8.0 to 9.0. With a dividend yield hovering around 6.8%, the shares may hold appeal for income-focused investors, provided the corporate separation is executed smoothly. Kraft Heinz's current market capitalization is approximately $27.4 billion.

This dual development—a major investor's exit and a sweeping corporate breakup—marks a pivotal chapter for the storied food conglomerate as both it and Berkshire Hathaway turn the page on a longstanding investment relationship.