Kraft Foods Group joining S&P 500
BY SANDRA GUY Business Reporter email@example.com September 26, 2012 8:18AM
Updated: October 29, 2012 6:25AM
Kraft Foods Group, which is being spun off from Northfield-based Kraft Foods Inc., will replace Alpha Natural Resources Inc. on the S&P 500 when it starts trading under its new ticket symbol on Tuesday.
After the split, both Kraft and Mondelez are expected to grow and maintain leading shares of key markets, a Morningstar analyst said Wednesday.
Kraft Foods Inc. is spinning off Kraft Foods Group, the $19 billion North American grocery business, with brands such as Velveeta, Jell-O, Oscar Mayer and Kraft Macaroni & Cheese. It will trade under the symbol “KRFTV” on the Nasdaq.
Kraft Foods Inc. is being renamed Mondelez, and will keep the $32 billion snacks business known for its Oreos, Tang, Trident and Ritz brands. It will trade under “MDLZV,” also on the Nasdaq. It will remain in the S&P 100 and the S&P 500.
The split is expected to take place at 4 p.m. Central time on Oct. 1, and the new companies are set to begin trading under their new ticker symbols Oct. 2.
Mondelez “is more than just a sweets company,” said Morningstar analyst Erin Lash.
The company holds 15 percent share of the global chocolate market, 30 percent of chewing gum, 18 percent of the cookies, crackers and biscuit market and 16 percent of powdered drinks, Lash said.
Mondelez is expected to benefit from quick growth in developing countries, where the company gets 44 percent of its sales. Mondelez already does business in Latin America and Asia-Pacific, and has discussed plans to expand in China and Indonesia, as well as in Germany, Lash said.
Kraft is expected to grow because it keeps innovating on its existing products and has successfully raised its prices without hurting demand, Lash said.