Kraft Heinz CEO Doesn’t Deny Potential Company Split

During the follow-up Q&A session after Kraft Heinz’s second quarter earnings call, CEO Carlos Abrams-Rivera was asked about rumors of a potential breakup of the company in the face of rough financial waters, and the executive did not deny the possibility of a split.

“Our Board is working with urgency on an evaluation of those strategic options to unlock, as you said, long-term strategic value creation,” Abrams-Rivera said, according to a transcript of the presentation and Q&A. “And what I will say also is, and I'll remind our investors, is that we will operate with the same financial discipline you have come to expect from us. And so any actions, if any, will be consistent with that goal of unlocking that long-term shareholder value.”

Talk of a significant split of the company has circulated since mid-July, when the Wall Street Journal first reported that the company was considering slicing off a significant part of the grocery business into its own entity. The company had been completely mum on the topic for the past three weeks until faced with a direct question during the earnings call.

The WSJ report wasn’t the first signs of change coming on the breezes for Kraft Heinz. In May, the company said it was “evaluating potential strategic transactions to unlock shareholder value,” which seemed to indicate it was shopping some of its businesses. Of course, the company’s Oscar Mayer brand has seemingly been available for purchase for more than a year, without any takers thus far, so take that news for what it’s worth.

Earlier this month, Kraft Heinz did find a buyer for its infant and specialty food business in Italy. All that said, back in May, Kraft Heinz announced it would spend $3 billion to upgrade its U.S. factories (without specifying any details or timelines), a lot of money to commit to improvements during perceived turbulent times.

Of course, as often happens with executive-level presentation speak, Abrams-Rivera’s answer during the Q2 earnings call doesn’t truly confirm anything — but it doesn’t appear to rule anything out either. As they say, stay tuned.