Food And Money: Heinz Kraft, A Marriage Of Brands

by March 26, 2015

No doubt you’ve used a bottle of Heinz ketchup at some point in your life. And you’ve probably stirred butter and that neon cheese packet together to make Kraft dinner.

Now, the two American food giants are getting married, in a merger made in processed food heaven. On Wednesday, a $28 billion deal was announced to create The Heinz Kraft Company.

The matchmaker for the combination was billionaire Warren Buffett, who has shown an increasing interest in food companies. In 2013, Buffett teamed up with Brazilian investment group 3G to buy Heinz.

Last summer, 3G, through its ownership of Burger King, snapped up Canadian coffee icon Tim Horton, named for the late hockey player. And of course, Buffett’s Berkshire Hathaway owns See’s Candy, which he credits as the basis of his far flung business empire.

The deal creates the world’s fifth largest food company. Some analysts say the merger brings to mind the creation of an American Nestle, the Swiss giant that dominates so many aspects of the food world.

However, others wonder if the merger hasn’t come too late, in a world that increasingly stresses local products and organic foods over those that come in on a truck.

NPR points out that Heinz and Kraft each have a storied history that dates back to their founders, Henry John Heinz (the H.J. in H.J. Heinz) and James Lewis Kraft (the J.L. in the J.L. Kraft to whom you sometimes spy a reference).

Both men became dominate food players in their respective cities, Heinz in Pittsburgh, Kraft in Chicago (although he actually was born in Buffalo. Perhaps he wanted a bigger lake with more snow).

There will be a Heinz Kraft headquarters in each place, an idea that other companies have tried, notably Daimler Chrysler, which had offices in Auburn Hills, Mich., and Stuttgart, Germany for about a decade, before Daimler sold Chrysler to an investment group.

Both Heinz and Kraft became philanthropists, whose support buoyed countless institutions, such as Heinz Hall in Pittsburgh, home to the Pittsburgh Symphony Orchestra, and Kraft’s Feeding America project.

Since products from both companies are on virtually every supermarket shelf across the United States, the Heinz Kraft merger brings to mind numerous story ideas. An ingenious reporter might spend a morning counting up the number of Heinz and Kraft logos along the aisles.

Watch a retro look at how Heinz ketchup is produced.