Kraft Heinz to Sell North American Coffee Business to One Rock for $650 Million, Keeping a 30% Stake

Kraft Heinz (KHC) agreed to sell its North American coffee business, including Maxwell House and Gevalia, to private equity firm One Rock Capital Partners at an enterprise value of $650 million, while keeping a 30% noncontrolling stake. The company expects about $500 million in after-tax cash proceeds, which it will use to pay down debt, according to Bloomberg and CNBC. Around 250 employees will move with the business, and the deal is expected to close in mid-2027 pending regulatory approval, according to Bloomberg and FoodNavigator.

The sale landed alongside third-quarter results that beat expectations. Adjusted earnings were $0.53 per share against a forecast of $0.42, and revenue of $6.12 billion topped the $6.08 billion estimate, according to the earnings call coverage on Investing.com. Organic net sales still fell 1.1%, though the company raised the low end of its full-year organic outlook to a decline of 1.25% to 0.5%, Bloomberg reported. Per SentiSense price data, the shares closed 3.8% higher at $25.44 on Wednesday.

The coffee exit is part of Chief Executive Steve Cahillane's turnaround. Cahillane joined in January and paused plans to split the company in two, CNBC reported, and is instead investing an incremental $700 million this year across product quality, select pricing, marketing, sales and research and development. Management now expects input-cost inflation slightly above 5% next year, up from a 4% to 5% range, and plans to lean on productivity first, though Cahillane said "'27 will require price".

Points to watch are the pace of debt reduction from the coffee proceeds, whether the $700 million investment turns organic sales positive, and how volumes hold up once price increases arrive in 2027.