Kraft Heinz to sell North American coffee business to One Rock for $650 million

Kraft Heinz said on 4 November that it will sell its North American coffee business to One Rock Capital Partners at an enterprise value of $650 million. The company will keep a 30% non-controlling stake and expects about $500 million in after-tax cash proceeds, which it plans to use to reduce debt.

The business includes Maxwell House, Gevalia, Nabob, Yuban, Tassimo, Ethical Bean and Sanka, along with coffee plants in Jacksonville, Florida, and Vancouver, British Columbia. About 250 full-time employees in manufacturing, sales, marketing, finance, human resources and research and development are expected to move with the business, Kraft Heinz said.

What One Rock is buying

One Rock is a private equity firm that specializes in acquiring and restructuring businesses, including corporate divestitures. One Rock said it bought Nestlé's North American bottled water business in 2021. One Rock managing partner Tony W. Lee said the firm intends to accelerate investment across the brand portfolio to drive growth and innovation, improve the consumer experience and strengthen retail relationships.

Kraft Heinz did not disclose the coffee division's revenue or profitability in the sale announcement. Coffee has faced increased competition from energy drinks in recent years, though it remains a large global market, Bloomberg reported. In its 2025 financial results, Kraft Heinz cited higher coffee costs as a driver of consumer price increases, along with declining coffee sales volumes.

Maxwell House came to Kraft through General Foods, which combined with Kraft in 1989 under then-parent Philip Morris. The coffee business stayed with Kraft Foods Group after its 2012 separation from what became Mondelēz International, and Kraft merged with H.J. Heinz in 2015. Kraft Heinz added Ethical Bean, a Vancouver-based specialty coffee roaster, in 2018.

Why Kraft Heinz is selling

Chief executive Steve Cahillane said the transaction was a meaningful step in the company's effort to realize value from its portfolio and would accelerate momentum behind its transformation. Kraft Heinz said divesting coffee would let it direct resources to brands it believes it can revive.

The sale follows a broader restructuring. Kraft Heinz announced plans in September 2025 to split into two publicly traded companies, then paused the work in February. Cahillane, who took over in January, said the business was "not yet healthy enough to stand alone as two entities." The 10-Q filed on 4 November says separation work remains paused and gives no restart date. A separate company update the same day said the split remained on track for the second half of next year, leaving open when the paused work would resume.

Third-quarter net sales fell 2.0% to $6.115 billion and organic net sales fell 1.1%, the company reported on 4 November, with weakness across coffee, cold cuts, frozen snacks and some condiment lines. Adjusted earnings per share of 53 cents came in above the average analyst estimate, Bloomberg reported, though they were down 13.1% from a year earlier. Kraft Heinz raised the low end of its full-year organic sales outlook to a range of down 1.25% to down 0.5%, from a prior range of down 2% to down 0.5%, the company said.

What happens next

The coffee sale is expected to close in mid-2027, subject to regulatory approval and other conditions. The $500 million in expected after-tax proceeds is about one-fifth of the $2.361 billion in free cash flow Kraft Heinz reported for the first nine months of 2026. Kraft Heinz shares rose 3.75% to $25.44 on 4 November, according to Kalkine Media market data.