Kraft Foods Splits Business Into Two Units

Kraft Foods Group Inc (NASDAQ:KRFT) has announced plans to create two business units which will each stand alone. The two units will be Meals & Desserts and Enhancers & Snack Nuts, and they will become separate as of July 1.

Kraft Foods Splits Business Into Two Units

Separation Of Kraft Foods’ Grocery Division

A press release issued by the company states that the two units will be created by dividing the Kraft Foods Group Inc (NASDAQ:KRFT)’s Grocery division into two separate business units which will stand on their own. The company said “categories and brands” with “natural synergies” will remain grouped together in one of the two divisions.

For example, it said the Cool Whip and JELL-O brands would stay together in the same brand. The company also said its Planters brand will be grouped with all of its snack nuts and peanut butter categories, which will all be managed by a single leadership structure.

Kraft Foods’ Top Brands

Kraft Foods Group Inc (NASDAQ:KRFT) gave some further indications of how its brands would be grouped. It said the Meals and Desserts category would include the brands Cool Whip, Jet-Puffed, JELL-O, Kraft Mac & Cheese, Shake ‘N Bake, Stove Top and all Velveeta meals and dinner kits.

The Enhancers and Snack Nuts category will include Kraft’s A1 Steak Sauce, Grey Poupon, barbecue sauces under the brand names Kraft and Bulls-Eye, dressings under the Good Seasons and Kraft names, Miracle Whip and Planters nuts, peanut butters, and trail mixes.

Kraft Foods’ Division Leadership

The Wall Street Journal’s Melodie Warner reports that the Meals and Desserts unit will be headed up by Michael Osanloo, who will be an executive vice president of the company and president of the new division. Currently he’s an executive vice president of the company and also president of the company’s Grocery division.

Jane Hilk will also be an executive vice president of the company, and she becomes president of the new Enhances and Snack Nuts division. She’s currently the company’s senior vice president of marketing for the Oscar Mayer brand.

Kraft Foods’ Stock Price

Since Kraft Foods Group Inc (NASDAQ:KRFT) made the announcement about splitting up its grocery division, shares were little affected. They fell as much as 1 percent at the NASDAQ on Friday after the news was released.

The company’s stock surged in May after its recent strong earnings report. After Kraft separates the two divisions out in July, it will break out the financial reports of each division. Those separated results will start appearing at the end of the company’s fiscal third quarter.