News that Kraft Heinz Co. (NASDAQ: KHC) has hired a bank for the potential sale of one of its dairy brands pushed its shares marginally higher early Wednesday.
Specifically, Kraft Heinz is looking to slim down its portfolio by unloading Breakstone’s brands, according to CNBC. Sources close to the matter said that the firm is valuing Breakstone’s at roughly $400 million.
Kraft Heinz has hired Royal Bank of Canada to review options for its Breakstone’s business. In simpler terms, the firm is looking for a sale. The move is understood to be part of a broader review of the company’s dairy business.
According to CNBC:
Breakstone’s, which has roughly $400 million in revenue and $50 million in earnings before interest, taxes, depreciation and amortization, could fetch a valuation of roughly $400 million, the people said. It could appeal to dairy companies like Dean Foods, Saputo or national milk cooperative, Dairy Farmers of America, one of the people said.
All this comes after Kraft Heinz released an abysmal report last month, which was in fact the worst report in the history of the company. The firm is still dealing with the fallout from this, and divestitures definitely make sense at this point.
Shares of Kraft Heinz were last seen up fractionally at $32.18, in a 52-week range of $31.60 to $67.91. The consensus price target is$38.52.