Kraft Separates Into Two Businesses

One will handle its snack food products while the other will take on its grocery products.

August 05, 2011

NORTHFIELD, Ill. - Kraft Foods Inc. announced yesterday that it will become two publicly traded firms, one for its snack food business and another for its grocery food business, the Associated Press reports. The split is happening as more retailers, such as Wal-Mart and Target, are upping their grocery and fresh food sections to become more one-stop shopping experiences.

"Our strategic actions have put us in a position to create two great companies, each with the leadership, resources and strong market positions to realize their full potential," said Irene Rosenfeld, chairman/CEO, in a statement.

The new snack food company will be comprised of Kraft Foods Europe and developing markets units, plus North American confectionery and snacks. The non-snacks part of that company will be nearly only coffee and powdered drinks.

The North American grocery company will keep its U.S. convenient meals, grocery, beverages and cheese, along with non-snack products in Canada and foodservice.

Kraft said the grocery firm split will take more than 12 months to complete management, structure and other concerns. The company said the spin-off should be finished by the end of 2012.

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