Kraft Heinz selling beloved coffee brand in $650M deal: Here’s why

NewsKraft Heinz is giving up control of one of coffee's most recognizable brands. Here's why, and what the company plans to do with the roughly $500 million it expects to get from the $650 million deal.Lukas Katilius | MLive.comBy Dallas Gagnon | MassLive.comKraft Heinz is giving up control of one of coffee’s most recognizable brands as the food giant shifts its attention toward parts of its business it believes have more room to grow. It also plans to use proceeds from the sale to pay down debt.Last week, the company announced it reached an agreement to sell its North American coffee business — including Maxwell House — to an affiliate of private equity firm One Rock Capital Partners in a deal that values the business at $650 million.Kraft Heinz will retain a 30% non-controlling stake, allowing the company to share in the coffee business’s future performance while One Rock takes control.The deal includes Maxwell House, Gevalia, Nabob, Yuban, Tassimo, Ethical Bean and Sanka, along with coffee manufacturing facilities in Jacksonville, Florida and Vancouver, British Columbia.The transaction is expected to close in mid-2027.Why Kraft Heinz is selling its coffee portfolioAccording to Kraft Heinz, the board of directors decided the move was necessary to “prioritize investments and resources toward areas of the business where Kraft Heinz can accelerate growth and deliver the best value to consumers, customers and shareholders.”Kraft Heinz CEO Steve Cahillane called the deal a “meaningful step in unlocking value” for the company’s portfolio.The $650 million valuation does not mean Kraft Heinz will pocket $650 million. The company expects about $500 million in net cash proceeds after taxes, which it plans to use to pay down debt.Kraft Heinz earnings results, financial wellbeingIts latest quarterly results show companywide net sales fell 2% in the third quarter compared with a year earlier, while North American sales declined 3.4%.In February, Kraft Heinz announced $600 million in additional investments across marketing, sales and research and development, along with product improvements and pricing.In August, it increased that planned investment to approximately $700 million, with Cahillane saying the company’s brands were responding well to increased investment.The coffee sale was announced during company’s third-quarter earnings call, Nov. 4. Cahillane called the sale “an important step in simplifying and strengthening our portfolio.” Part of that includes focusing on continued investments in brands like Kraft Mac & Cheese, PowerMac and Capri Sun. Cahillane said the company has had “very constructive dialogues” with retail partners, who “love the fact that we’re making these investments.” He said the company has a plan to grow its total distribution points and expects the “next level of improvement” to start next year, “exactly as we expected it.”President Trump floated this Alabama ‘legend’ as a surprise candidate to become Nvidia’s CEOAmazon’s 2026 Black Friday schedule released: Deals running daily for nearly 2 weeksU.S. Space Command leader says great opportunities found in Auburn north Alabama facilitySouthern rock’s best frontman standing talks death, barbecue, long road to topBirmingham wine bar closing permanently: ‘It was a good run’Dallas Gagnon is a Business Trending Reporter and a Reporting Fellow with the Newhouse School of Communications. Dallas covers everything from business openings and closures, national business news, layoff...