Kraft Heinz's decision to tap Steve Cahillane - the dealmaker who steered Kellogg through one of the packaged food industry's biggest breakups - signals the ketchup maker may be positioning itself for major asset sales as it pushes ahead with its own split, according to bankers, analysts and a former executive.
Kraft Heinz announced the CEO change while in the midst of separating its more than 200 brands into two companies. Shares of the Jell-O maker, among the worst performers in packaged food, are down 19 per cent this year, versus a rise of almost 3 per cent in the broader S&P 500 Consumer Staples index.
Former Kellogg CEO Cahillane, appointed to run Kraft Heinz on Tuesday, oversaw the separation of the Corn Flakes and Pringles maker about two years ago, which later saw privately-held Mars scooping up the faster-growing snacks division, Kellanova, at a 33 per cent premium.
“I am honored to be joining Kraft Heinz as CEO at such a pivotal and exciting time,” said Cahillane. “Like millions of people around the world, I have a deeply personal connection to the Kraft Heinz brands, dating back to my childhood. I’ve devoted my entire career to building brands, and the opportunity to do the same with Kraft Heinz’s iconic portfolio is a dream come true."
“I’m confident the planned separation will accelerate the Company’s ability to compete and win in today’s environment and unlock the immense opportunity in front of us,” he added.
With Cahillane on board, Kraft Heinz may be hoping to woo a suitor for its sauces and condiments business, which is expected to have higher margins than its grocery division, according to analysts.
"It's clear they're signaling to the market and potential buyers that they're in play," said Bill Johnson, the CEO of H.J. Heinz until 2013, when it was taken private by Warren Buffett's Berkshire Hathaway and Brazil-based 3G Capital. "We have someone who knows how to do these deals.
"It's (also) an acknowledgement the management team needed upgrading. In case they can't sell the company, they need someone who can operate it better than it's been operated," Johnson added.
Steve CahillanePhoto via Business Wire
Over the course of his thirty-plus-year career, Cahillane has held senior executive roles at The Nature’s Bounty Co., The Coca-Cola Company and AB InBev.
“Steve is uniquely qualified to lead this organization into the future, and we are delighted he will be taking on the role of CEO. His track record and experience in the industry are unparalleled and will be invaluable as we embark on this next chapter,” said Miguel Patricio, chair of the Board, Kraft Heinz.
Shoppers cut back
Sales of packaged food in the United States have faltered as shoppers cut back due to sky-high prices, and try newer brands with less processing, hurting Kraft Heinz and its rivals like Conagra.
Kraft Heinz, created in a 2015 megadeal, however, has particularly struggled with well-worn brands like Crystal Light drinks, Lunchables meal kits and Kraft Mayo.
Cahillane will also lead Kraft Heinz's condiments and spreads business, Global Taste Elevation Co., which includes Heinz ketchup and Philadelphia cream cheese, after the split, set to be finalised at the end of 2026.
That division is expected to command a higher multiple than Kraft Heinz's overall because of the higher margins, exposure to international markets and potential faster growth. Kraft Heinz's multiple lags peers including General Mills, Mondelez and Conagra.
A bottle of Heinz tomato ketchup is displayed next to a box of Kraft Mac & Cheese on September 02, 2025 in San Anselmo, California. Photo Illustration by Justin Sullivan/Getty Images
This year ushered in a crop of major deals for consumer-facing companies like Kraft Heinz, which have faced blowback from shoppers on high prices and wrestled with increasing costs from tariffs.
The administration of US president Donald Trump is also smoothing the path for deal-making, in contrast to his predecessor former president Joe Biden.
Huggies diaper maker Kimberly Clark announced plans to acquire Kenvue, which markets pain reliever Tylenol, for nearly $50 billion (£37.5bn) last month. European confectioner Ferrero bought Kellogg's smaller cereal unit, W.K. Kellogg, for $3.1 billion earlier this year, another success for Cahillane.
To be sure, Max Gumport, a senior analyst at BNP Paribas, said in a research note that he struggles to see logical buyers for Kraft Heinz's business after the split.
Kraft Heinz failed to sell Oscar Mayer last year. It also attempted to sell coffee brand Maxwell House.
(With Reuters Inputs)