WHEN: Today, Tuesday, September 2, 2025
WHERE: CNBC’s “Squawk on the Street”
Following is the unofficial transcript of breaking news from CNBC’s Becky Quick on “Squawk on the Street” (M-F, 9AM-11AM ET) today, Tuesday, September 2. Video will be available on CNBC.com.
All references must be sourced to CNBC.
SARA EISEN: Big corporate news today. Kraft Heinz announcing it is splitting into two companies, undoing the merger originally envisioned by Warren Buffett. Becky Quick, just off the phone with Buffett and joins us now with the details. Becky.
BECKY QUICK: Hey, Sara. Hey, Carl, it’s good to see both of you obviously what Berkshire Hathaway thinks about this is a pretty big deal because Berkshire Hathaway is the largest shareholder in Kraft Heinz. It owns 27.5% of that company. Well, if you’re wondering what Buffett and Berkshire are thinking about this, here’s the answer in one word, disappointed. Warren Buffett tells me that they were disappointed with them coming up with this idea, and then disappointed, on top of that that shareholders will not be getting a vote when it comes to what’s going to be happening with this. He says that they will continue to do, they will proceed to do from this point whatever they think is in the best interest for Berkshire on this. He said if we are approached about selling our shares, we wouldn’t accept a block bid unless the same offer is made to other shareholders. In other words, they’re not going to sell a block bid in a deal price that they can get that the rest of the shareholders won’t if they’re they haven’t decided what they’re going to be doing. But if there’s a buyer who comes forward, it would have to be someone who was buying the entire company. Now he did tell me, but Warren Buffett told me that Kraft Heinz spoke with Greg Abel about a week ago and said they’d been working on this a long time. Greg Abel told them that he’d be disappointed if they went ahead with this. And sure enough, a few days ago, word came back that they were going to go ahead with it anyway. Basically, they were informed about what the Kraft Heinz board had decided on all of this. I asked Warren Buffett why they didn’t like this deal. He said, for starters, it should cost them about $300 million to implement this and additional overhead costs, and that it’s going to take about a year to do so. So that’s time that, I guess, in his view, is wasted at that point. His words exactly to me were, “It certainly didn’t turn out to be a brilliant idea to put them together, but I don’t think taking them apart will fix it.” If you looked at the stock’s performance over the last 10 years, you’d see a little bit of the pain that Berkshire has been in over this period of time. Just over the last year, yeah, you can see here, since the merger closed in 2015, stock’s down by about 70%, it’s been down about 20% over the course of this year, and it’s down three and a half this morning, three and a half percent this morning on this news. Now, this was a deal that Berkshire put together with 3G at that point, they were very optimistic about what could be accomplished. They did squeeze out some of the overhead costs at that point. It looked like it was doing fairly well for a while, but it’s been quite a while since that stock has had any sort of good performance on anything. Berkshire’s people resigned from the board of Kraft Heinz. They had two designated board members who resigned at, I guess, Warren Buffett and Greg Abel’s suggestion at that point, back on May 19 of this past year, I guess they saw kind of where things were headed. Weren’t really in favor of it, so decided they didn’t want to have their people voting on something along those lines. But if you look at this again, Berkshire Hathaway is the largest shareholder by far, 27.5%. Berkshire has never sold or bought any stake. I think originally they were close to about 26% Kraft Heinz has bought in shares, and that’s what’s boosted its stock to about 27.5%. But if you look at the list of other big shareholders in this stock, you’re going to see its Vanguard Group at about 8.6%, BlackRock institutional has 4.3%, State Street has 3.9%, Geode has two and 2.2%, Invesco Capital Management, with the triple Q’s, has about 2% even if you add up those next five shareholders, that only gets you to about 21% of the shares versus the 27.5% that Berkshire is owned. Now, obviously it’s been a long issue that Berkshire almost never is an active shareholder. They are passive shareholders. They don’t like to get involved in this, but I guess this is a situation where that sort of passive investment has been taken advantage of to the extreme, to the point where even they, when they voice their opinions and say they’re not in favor of something with a stake this whole this big, they’re getting ignored on this front. So again, it looks like Kraft Heinz shares this morning down by just over 3.6% but again, the largest shareholder, Berkshire Hathaway, is disappointed by this move to split those companies.
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