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Shining a light on PE ownership.

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KR

Kraft Heinz

food_consumer
PE-OWNED

Major food company formed from merger of two iconic brands.

PE-OWNED

Acquired by 3G Capital2015-07-01

View PE Firm Profile

What Made It Great

“

America's favorite ketchup and mac & cheese in every home.

What PE Will Likely Do

Predictions

Kraft Heinz will reduce the quality of its iconic products like Heinz Ketchup and Kraft Macaroni & Cheese by replacing high-quality tomatoes and cheese with cheaper ingredients

HIGH LIKELIHOODBased on: 3G Capital's track record of cost-cutting and brand consolidation in other acquisitions

Kraft Heinz will implement 'shrinkflation' by reducing the package sizes of its products while keeping prices the same or increasing them

HIGH LIKELIHOODBased on: The industry playbook for common private equity tactics in the food consumer industry, including ingredient downgrades, shrinkflation, supply chain changes, formula changes, and manufacturing consolidation

Kraft Heinz will consolidate manufacturing facilities and switch to lower-cost suppliers, leading to changes in the taste and texture of its products

HIGH LIKELIHOODBased on: The timeline of quality degradation and brand reputation loss observed in similar past cases

Kraft Heinz will alter the recipes of its products to reduce costs, potentially changing the flavors that consumers have come to expect

HIGH LIKELIHOODBased on: The timeline of quality degradation and brand reputation loss observed in similar past cases

Expected Timeline

Phases
0-6 monthsCompleted

“0 to 6 months months”

Minimal visible changes as ownership transition occurs

6-12 monthsYOU ARE HERE

“6 to 12 months months”

Behind-the-scenes supplier and formula changes begin, with gradual quality degradation

12-24 months

“12 to 24 months months”

Consumers start noticing quality differences in Kraft Heinz products, with complaints and negative reviews increasing

Similar Cases

Other companies that followed a similar path after PE acquisition

Operating

Del Monte Foods

KKR·2011

See full case study
Operating

Birds Eye

Permira·2009

See full case study
Operating

Bumble Bee Foods

Lion Capital·2010

See full case study
Operating

Weight Watchers

Artal Group·1999

See full case study
Operating

Atkins Nutritionals

Roark Capital·2017

See full case study

What You Can Do

Take Action

Actions

  • Be on the lookout for changes in the taste, texture, and packaging of Kraft Heinz products

  • Compare the quality and pricing of Kraft Heinz products to competitor brands to identify any notable declines

  • Voice your concerns and feedback directly to Kraft Heinz to hold the company accountable for maintaining the quality of its iconic products

Alternatives

Research independent alternativesSAFE

Look for family-owned or employee-owned businesses

Share this company's PE status
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"Kraft Heinz is now PE-owned. Here's what that means for you."