KRAFT MERGES WITH HEINZ: A CASE STUDY Case Solution
This case is about Business
This case handles the fundamental understanding of mergers by concentrating on synergies associated with the merger of Kraft and Heinz. This merger produced a brand-new business Kraft Heinz Business (KHC) on July Second 2015 with a ticker sign of KHC on NASDAQ from July Sixth 2015. KHC ended up being the 3rd biggest Food and Drink Business in The United States and Canada and the 5th biggest Food and Drink Business on the planet. The merger was revealed on March 25th 2015 which included the merger of an openly traded business Kraft Foods Group and an independently stood pat H J Heinz Business. The investment company, 3G Capital and Berkshire Hathaway, backed this USD62.6 billion offer which was among the huge mergers in the United States in 2015. Warren Buffett’s Berkshire Hathaway owned about 325 million shares in Kraft Heinz Business after investing about USD9.5 billion. The anticipated synergy from the offer was growth of Kraft’s items globally through Heinz’s worldwide outreach and expense cutting through efficient procedures. The other advantage of this particular merger originated from Kraft’s far better credit score than that of Heinz. Heinz anticipated to re-finance its high-yielding financial obligation with low-yielding, investment-grade financial obligation.