Kraft completes split after market close
BY SANDRA GUY Business Reporteremail@example.com October 1, 2012 6:10PM
Updated: November 3, 2012 6:19AM
Kraft Foods Inc. split into two companies after the market close Monday, creating a “new” Kraft Foods with well-known brands in a slow-growth industry, and Mondelez International, a global snack-foods company aiming for fast growth in developing countries.
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 “KRFT” on the Nasdaq.
Kraft Foods Inc., renamed Mondelez, will keep the $36 billion snacks business known for its Oreos, Tang, Trident and Ritz brands. It will trade under “MDLZ,” also on the Nasdaq.
Barron’s reports that the new Kraft Foods’ shares will boast the highest yield, at 4.5 percent, of any major food company, and should trade for more than 17 times projected 2013 profits. Kraft expects a profit of $2.60 a share. Kraft expects to grow by producing new twists on its well-known brands, such as introducing Cool Whip frosting to the frozen foods aisle.
Mondelez has forecast a $1.50-to-$1.55-a-share profit for 2013 and expects to become a high-growth company by selling its candy, chocolate, cookies and crackers in developing countries, analysts say.
Kraft Foods is keeping the headquarters in Northfield, while Mondelez will be based in Deerfield.