New York, March 25 (Xinhuanet) -- Heinz Foods and Kraft Foods announced on march 25 that the two companies have reached a final merger and acquisition agreement to form Kraft Heinz, the third largest food and beverage company in North America and the fifth largest in the world.
After the merger, Kraft Heinz will own eight brands worth more than $1 billion, including Oreo, Maxwell, and Guozhen, and its annual operating income is expected to reach about $28 billion.
In this merger, 3G Capital and Berkshire Hathaway, led by "stock god" Buffett, will invest an additional $10 billion. After the merger, the existing shareholders of Heinz Foods will hold 51% of the shares of the new company; the existing shareholders of Kraft Foods will hold 49% of the shares of the new company and will receive 16% per share at the same time. A special cash dividend of $5.
After the merger, former Heinz Foods Chairman Alex Belling will become the new Chairman of Kraft Heinz, former Kraft Foods Chairman and CEO John Cahill will serve as Vice Chairman of the new Company, and former Heinz Foods CEO Bernardo Heath will become CEO of the new company.
The deal still needs approval from U.S. regulators, Heinz and Kraft shareholders, but the boards of directors of the two companies have agreed on the merger.