Kraft Heinz went though a traditional 'foodnaissance' during the pandemic, but now it might flog its Aussie division.
👉 Background: Kraft Heinz is the fifth-largest food and beverage company in the world. It's the giant behind Golden Circle juice, Philly cream cheese and of course Heinz favourites like their canned soups and tomato ketchup.
👉 What happened: Kraft Heinz made US$26 billion in global net sales last year. That's a lot of hearty vegetable soup! But now rumours are 'flyin' that Kraft Heinz wants to carve off its Australian and New Zealand arm and it's lookin' for a buyer.
👉 What else: There are a few global private equity giants circling the $1 billion business. It's all part of a trend of big global consumer companies selling out of regional markets.
💡M&A activity in the consumer space has been few and far between in the past year - which is why this deal would be a big move for the consumer and retail space.
💡Demand for ‘old fashioned’ foods like Kraft Heinz has been all over the place lately. Before COVID-19, old fashioned foods had fallen out of vogue. But then, lockdown hit and everyone was suddenly craving comfort foods from their childhoods.
💡Now that's fading. Kraft Heinz’s EBITDA for the June quarter is down around 10% year on year and now supply chains are chaotic. And all these moving parts make it harder for prospective buyers to get a good idea of companies' future earnings.
Sign up for Flux and join 100,000 members of the Flux family
