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

Kraft Heinz announced on November 4 that it has reached a definitive agreement to sell its North American coffee business to private-equity firm One Rock Capital Partners at an enterprise value of $650 million. The portfolio includes Maxwell House, Gevalia, Nabob, Yuban, Tassimo, Ethical Bean and Sanka. Kraft Heinz will retain a 30% non-controlling equity stake in the business, while One Rock will acquire the controlling interest.

The transaction is expected to close in mid-2027, subject to regulatory approval and other customary closing conditions. Kraft Heinz expects to receive approximately $500 million in net cash proceeds after taxes and plans to use the money to pay down debt. About 250 full-time employees and coffee manufacturing facilities in Jacksonville, Florida, and Vancouver, British Columbia, are expected to transfer with the business.

Seven coffee brands are included in the deal

The sale covers the North American coffee business, including its brands, assets, customer support and the resources required to operate the unit. The brands include Maxwell House, Gevalia, Nabob, Yuban, Tassimo, Ethical Bean and Sanka. One Rock will own 70% of the business, while Kraft Heinz will keep a 30% non-controlling interest.

The transaction also includes the Maxwell House manufacturing facility in Jacksonville and a coffee facility in Vancouver. Kraft Heinz said approximately 250 full-time employees across supply chain, sales, marketing, finance, human resources and research and development are expected to move with the business.

One Rock managing partner Tony W. Lee said the firm intends to invest in the brand portfolio, product innovation and relationships with retail partners. The private-equity firm has experience in corporate carve-outs and operational improvement. The deal is expected to close in mid-2027, but it remains subject to regulatory approval and other conditions.

Kraft Heinz wants to focus on its core brands

CEO Steve Cahillane said the transaction will unlock value from the company’s portfolio and accelerate its transformation. Kraft Heinz has been prioritizing investment in brands such as Heinz, Kraft, Philadelphia, Primal Kitchen and Lunchables, aiming to improve growth through marketing, innovation and a more focused product mix.

Reuters reported that the North American coffee business accounts for about 3% of Kraft Heinz’s net sales and has lower margins than some of the company’s other priority businesses. The divestiture allows Kraft Heinz to reduce its exposure to a slower-growing unit while retaining a minority stake in its future performance.

The company expects about $500 million in after-tax cash proceeds and plans to use the money to reduce debt. One Rock will take responsibility for day-to-day operations and future investment once the transaction is completed. Until then, Kraft Heinz will continue to operate the business.

Third-quarter sales remain under pressure, but guidance improves

Kraft Heinz also reported third-quarter results on November 4. Net sales declined nearly 2% year over year to $6.12 billion, slightly above analyst expectations of $6.09 billion. Adjusted earnings were 53 cents per share, beating forecasts. The company raised its full-year 2026 organic net sales outlook, now expecting a decline of 0.5% to 1.25%, compared with its previous expectation of a decline of as much as 2%.

The company said volume remained under pressure during the quarter, particularly in North America. Management is increasing spending on marketing and innovation and shifting its product focus toward areas such as protein-rich foods and electrolyte beverages. The coffee sale is part of that broader effort to concentrate resources on brands where management sees better opportunities for growth and margins.

The divestiture is not yet reflected as a completed transaction in the company’s results. The final financial impact will depend on the closing date, regulatory approval and the terms that are ultimately completed.

Regulatory approval and employee transfers remain ahead

The confirmed terms are an enterprise value of $650 million, a 70% sale to One Rock, a 30% retained stake for Kraft Heinz and expected after-tax proceeds of about $500 million. Approximately 250 employees and the Jacksonville and Vancouver manufacturing facilities are expected to transfer with the business. The transaction is expected to close in mid-2027.

The companies have not disclosed the detailed employee transition plan, future product strategy or whether One Rock will make additional acquisitions or investments in the brands. Kraft Heinz has also not said whether it will divest other non-core businesses. For consumers, the agreement does not mean Maxwell House or the other brands will immediately change ownership or operations; Kraft Heinz will continue to run the business until the deal closes.