Dive Brief:
- Kraft Heinz has tapped former Kellanova CEO Steve Cahillane to run the Oscar Mayer and Philadelphia cream cheese maker starting Jan. 1 ahead of its split later in 2026.
- Following Kraft Heinz’s separation, Cahillane will become CEO of the business unit the company is calling Global Taste Elevation. The division will include higher-growth brands such as Heinz, Philadelphia and Kraft Mac & Cheese.
- Carlos Abrams-Rivera, Kraft Heinz’s current CEO, will step down and serve as an adviser to the company until March 6, 2026.
Dive Insight:
Cahillane is no stranger to breakups.
The seasoned executive oversaw the 2023 split of Kellogg into snack behemoth Kellanova and cereal giant WK Kellogg. Within two years, the companies were purchased for sizable premiums by candy makers, with Ferrero buying WK Kellogg, and Mars adding Cheez-It maker Kellanova just last week. Cahillane is wasting little time moving on to his next venture in food.
"Steve is uniquely qualified to lead this organization into the future, and we are delighted he will be taking on the role of CEO,” Miguel Patricio, Kraft Heinz’s chairman, said in a statement. “His track record and experience in the industry are unparalleled and will be invaluable as we embark on this next chapter."
Setting up a Kraft Heinz split for success could prove more of a challenge. The company has grappled with slumping sales across its portfolio as consumers transition away from processed food and inflation prompts shoppers to cut back on spending. At the same time, food makers are feeling pressure as GLP-1 medications lead some people to eat less.
Kraft Heinz has been working aggressively to expand some of its key brands into new categories in an effort to boost sales, bringing Philadelphia into cream cheese frosting and Crystal Light into alcohol with a hard seltzer line.
Kraft Heinz’s upcoming split, which the company touted would create two, more focused entities, will largely reverse much of the $46 billion merger that formed one of the world’s largest food giants a decade ago.
Once the breakup occurs, Cahillane will take over Global Taste Elevation, which will have an estimated $15 billion in sales. It will focus primarily on sauces, spreads, seasonings and shelf-stable meals. The second company, called North American Grocery, will house staples such as Oscar Mayer, Kraft Singles and Lunchables.
Robert Moskow, an analyst with TD Cowen, said in a note to investors that the decision by Kraft Heinz to have Cahillane run Global Taste Elevation “reinforces our view that the board views [it] as a likely target for acquirers in its entirety or in parts over time.”
Outgoing Kraft Heinz CEO Carlos Abrams-Rivera, who took the post in 2024, was initially picked to oversee the North American Grocery spin out, which would have $10 billion in annual sales. Kraft Heinz said Tuesday its board will look for another executive to lead the grocery segment.
Erin Lash, a director of consumer equity research at Morningstar, noted that shares of Kraft Heinz are down nearly 30% since Abrams-Rivera took the helm in 2024. She said Cahillane will “be charged with expediting its turnaround.”
“We believe the firm's strategic course — extracting inefficiencies to fuel investments in its brands and capabilities—is sound," Lash said in a note to investors. "Still, a lack of financial improvement (with organic sales down 3% through the first nine months of fiscal 2025 on weak volumes) likely prompted the change.”
