In an interview with Michelle Pickering, Kraft Foods research and development control manager for the Middle East and Africa, it was announced that Kraft will be considering the creation of two independently publicly traded companies.
She said, 'Kraft's aim is to be a global snack powerhouse.’ Kraft's first big step towards this change was in buying Cadbury. Eighteen months into the Cadbury integration, the company has built a global snacking platform and a North American grocery business that now differ in future strategic priorities, growth profiles and operational focus.
In mid August, despite the recession hitting an all time low on the American stock market, Kraft experienced an all time high in market share value emphasising this decision was on track with global market needs. ‘As our second quarter results once again show, our businesses are benefiting from a virtuous cycle of growth and investment which we fully expect will continue,’ said Irene Rosenfeld, chairman and CEO of Kraft Foods.
The first of Kraft's new companies: Global snacks is worth an estimated $32 billion and the second: North American grocery business an estimated $18 billion. 'Everything's happening so quickly we still don't know what we are going to be called,' said Pickering.
Global snacks will consist of the current Kraft Foods Europe, developing markets units and the North American snacks and confectionery businesses. Key brands will include, Oreo and LU biscuits, Cadbury and Milka chocolates, Trident gum, Jacobs coffee and Tang powdered beverages.
The North American grocery business will have a highly competitive retail presence, cost leadership and a continued commitment to innovation and marketing excellence. Key brands will include Kraft macaroni and cheese, Oscar Mayer meats, Philadelphia cream cheese, Maxwell House coffee, Capri Sun beverages, Jell-O desserts and Miracle Whip salad dressing.
Over the course of Kraft’s strategic transformation, the board of directors and management have explored opportunities to further enhance performance and increase long-term shareholder value and believe that creating two independent public companies was the next logical step.
‘The focus and other benefits that come from creating two companies will provide even greater opportunities for our people and our brands,’ concluded Rosenfeld.
