Warren Buffett said Wednesday on CNBC that talks between Kraft
Foods Group Inc. and H.J. Heinz Co. "had been in the works for
about four weeks or so," and moved along fairly quickly in the deal
in which Berkshire Hathaway and Heinz owner 3G Capital Partners
L.P. helped create the world's fifth-largest food and beverage
company.
In the merger, Mr. Buffett's Berkshire Hathaway Inc. and
Brazilian private-equity group 3G Capital will provide $10 billion
to fund a special dividend for the new company.
3G has been a "perfect partner," Mr. Buffett said, and they are
"buying to keep" just as Berkshire. "We'll be in Kraft-Heinz
forever," he said, using an oft-repeated phrase to describe his
investments.
Asked about changes in consumer trends with respect to packaged
foods, the Berkshire Hathaway chief said "the tastes of Kraft-Heinz
are enduring" and added he liked many of the Kraft brands as long
as "30 years ago" and "still liked them."
Nonetheless, he emphasized the new operation is "not static" and
that there are at least three new product lines coming at Heinz and
as well as others at Kraft.
Mr. Buffett also said it was possible that the merger could lead
to an expansion of Kraft lines internationally, as many of the
agreements concerning its separation from Mondelez had time
covenants which would expire.
Asked if he felt the 3G-Berkshire partnership was the ideal
platform from which to launch other ownership deals, Mr. Buffett
said there is "no finish line with our investments" and that they
were continuing to look for other opportunities.
Full story at www.cnbc.com
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