By Jesse Newman | Photography by Nate Ryan for WSJ
Just weeks after being named CEO of Kraft Heinz, Steve Cahillane flew to Omaha, Neb. to meet with an important shareholder: Berkshire Hathaway.
It was January, and Cahillane had asked for an introductory meeting with Berkshire's new CEO, Greg Abel. Kraft Heinz's business was struggling, and the $25 billion company was planning to split in two, an idea Berkshire had publicly opposed.
Cahillane, who was tasked with executing the separation, had a message for Abel: Shareholder returns were a priority. Cahillane thought the breakup made sense, though he was still studying things.
At Berkshire's headquarters, Abel reiterated their concerns: Kraft Heinz had plenty of problems, but breaking up the company wouldn't solve them.
The meeting didn't appear to assuage those concerns. On Jan. 20, Kraft Heinz announced that Berkshire could shed nearly all of its 28% stake in the food company, prompting a sharp drop in its stock. Within weeks, Cahillane would come to share Abel's opinion that a split wasn't the right move.
Kraft Heinz had tapped Cahillane in December to oversee the strategic shift after a bruising decade for one of the world's largest food companies. Its shares had lost almost a third of their value over the previous five years, and sales had dropped each quarter for two years.
The meeting was a first step by Cahillane to get Kraft Heinz back on track with Berkshire -- an original architect of the company that now disapproved of its direction. Berkshire's Warren Buffett had said breaking up the maker of Heinz ketchup and Kraft mac and cheese would be costly and disruptive, and that shareholders should have gotten a vote.
"It doesn't create value, and it involves lots of expenses," Buffett said in September. "It doesn't do a thing, you know, for what the ketchup tastes like."
A breakup artist
Kraft Heinz and Berkshire, its largest shareholder, have been deeply entwined since the food company's creation over a decade ago. Buffett, Berkshire's longtime CEO, teamed up with Brazilian private-equity firm 3G to buy Heinz in 2013. Two years later, they orchestrated a merger with Kraft.
In the years that followed, Kraft Heinz's business stumbled as executives slashed costs and underinvested in the company's aging brands. Buffett, who served on the company's board until 2018, initially defended Kraft Heinz in the face of criticism. Ultimately, he soured on the merger.
In 2019, Buffett said he had overpaid to help form Kraft Heinz. Berkshire pared back its presence on the company's board: Abel retired in 2024, and the two remaining Berkshire officials stepped off last year.
At a time when many big food companies are struggling, Kraft Heinz has run into particular trouble. Demand suffered in recent years for many of its core products, from Lunchables to Capri Sun, as consumers turned to both buzzier premium options and cheaper supermarket knockoffs.
Kraft Heinz's former CEO, Carlos Abrams-Rivera, and its board decided last summer that the best path was to split the company, separating its global condiments and North America grocery businesses. By fall, however, Kraft Heinz was quietly looking for a new CEO. John Cahill, at the time vice chair of the board and the head of a committee overseeing Kraft Heinz's break up, called Cahillane.
Cahillane, a 6-foot-tall marathoner who sports a shock of white hair and a practiced poker face, was a seasoned food executive, fresh off the successful breakup of another food company: Kellogg. Before that, he had split a vitamin business in two.
'Cry for resources'
The 60-year-old was mulling his next move and fielding inquiries from companies including Constellation Brands, the maker of Modelo and Corona beers. He and Cahill served together on Colgate-Palmolive's board.
Running an iconic American company appealed to Cahillane. It wouldn't be easy, but he knew the products well: He had grown up eating hot dogs smothered in Heinz ketchup at Yankees games as a kid.
Born in the Bronx to a New York City firefighter and Irish immigrant, Cahillane started in the food business with a $5-an-hour gig at a New York pizza parlor and a job stocking Kool-Aid in grocery stores. After college, Cahillane spent decades working inside food and beverage companies such as Coca-Cola and Stella Artois brewer InBev.
Cahillane took the reins at Kraft Heinz on New Year's Day. The company said that after the separation, he would lead its faster-growing condiment business, with brands like Heinz ketchup and Grey Poupon mustard.
The CEO began digging into Kraft Heinz's books and visiting the company's facilities. He toured its innovation center in Glenview, Ill., and an 88--acre operation downstate in Champaign that churns out over one billion pounds of Heinz Ketchup, Kraft Mac and Cheese and Kraft Mayo each year.
He held meetings with Kraft Heinz's top 100 leaders, a group called ATK, or Around the Kitchen. He asked employees what had gone wrong. Why wasn't the business growing? What was needed to get it back on its feet? Was it possible?
Cahillane said one message was clear: The company was too lean. Spending on things like product development, advertising and promotions ran behind other food companies.
"The number of times I heard, 'I've only got one junior person working on this brand. I can't make a difference that way,' " Cahillane said in an interview. "It was really a cry for resources."
Facing the board
The more Cahillane learned, the more he began to worry that it was going to be difficult -- if not impossible -- to improve Kraft Heinz's businesses while also setting them up for a separation. Pulling off a split that yielded two healthy companies was beginning to look daunting.
By late January, Cahillane was due to face his board. The night before a meeting with Kraft Heinz directors, Cahillane made up his mind to recommend a change in course. He told only his wife of his plans. Half an hour before the meeting, he informed Cahill, now the board's chair.
Cahillane walked into a conference room on Kraft Heinz's 75th floor with only a few notes in hand. Taking his seat, he praised the months of work Kraft Heinz had done to begin breaking the food giant in two. Then he told them he had a new idea: Forget it (at least for now).
Kraft Heinz, he was thinking, had exited 2025 with its business in decline. The breakup would cost $300 million and require countless hours of work from the same people needed to breathe life back into the brands.
"Doing those two things successfully, I thought, was untenable," he said.
Rather than split the company, Cahillane would stake his -- and Kraft Heinz's -- future on first turning around an ocean liner of a company with nearly 200 brands.
Cahillane said the board peppered him with questions but came around quickly, encouraged by his optimism that Kraft Heinz's problems could be fixed. He proposed investing $500 million to revive the business. The board offered $100 million more.
Afterward, Cahillane dialed Abel, and informed him of the change in plans. Abel issued a statement after Kraft Heinz announced the split's pause in February, saying he supported the move.
Going forward, Cahillane is continuing to consider a range of scenarios for the business, according to people familiar with the matter.
Kraft Heinz recently held talks with Hellmann's mayonnaise-maker Unilever about a possible food deal, according to people familiar with the talks. But Unilever is now in talks to do a deal with spice-maker McCormick, The Wall Street Journal has reported.
Kraft Heinz is planning to invest heavily in marketing, sales, research and development and other areas. Cahillane has said that the company will focus on offering consumers better value, including through healthier options like a new Kraft mac and cheese variety called "PowerMac," made with 17 grams of protein and six grams of fiber.
"I've said many times it's a 'show me story,'" Cahillane said. "Now we have to go prove it."
Write to Jesse Newman at jesse.newman@wsj.com
(END) Dow Jones Newswires
March 27, 2026 05:30 ET (09:30 GMT)
Copyright (c) 2026 Dow Jones & Company, Inc.
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