Kraft to create new companies by late 2012
Sept. 7, 2011
BOSTON — Kraft Foods Inc. plans to launch its two independent public companies by late 2012, and strong financial results and operating momentum across the world have made the company’s plan possible, according to a presentation by Irene Rosenfeld, chief executive officer, at the Barclays Capital Back-to-School Consumer Conference on Sept. 7.
“Over the past four years, we’ve fundamentally changed the face, footprint and prospects of Kraft Foods,” Ms. Rosenfeld said. “We’ve successfully positioned our company to deliver sustainable top-tier growth by reinvigorating our iconic brands, transforming our portfolio and strengthening our presence in fast-growing developing markets. But taking our performance to the next level requires a bold new approach — creating two great companies that can optimize value by focusing on their unique drivers of success.”
The North American Grocery business will have annual revenue of about $16 billion and market-leading positions in about 80% of its categories. It will include the Kraft, Maxwell House, Oscar Mayer and Philadelphia “billion-dollar” brands, plus three more brands with revenues of at least $500 million and another 14 brands with revenue of more than $100 million.
The Global Snacks business will have revenues of about $32 billion. It will have more than 42% of sales from developing markets, 36% from Western Europe and 22% from North America. About 75% of Global Snacks revenue will come from snacks, and it will have eight “billion-dollar” brands — Cadbury, Jacobs, LU, Milka, Nabisco, Oreo, Tang and Trident. It also will have another six brands with revenue of more than $500 million and 40 other brands with more than $100 million in sales.
Until the new companies are created, Kraft will continue to report as one company and will work to deliver on its goals for 2011 and 2012.