Food company Kraft Heinz KHC,has struggled to sell the Maxwell House coffee brand since putting it up for sale in February for about $2.5 billion, the New York Post reported Thursday.
What Happened
Potential buyers met with Kraft Heinz in April to look at the books, but no offer was made, the Post said, citing an unnamed consumer banker.
The $2.5-billion price tag is one sticking point, the report said. While Kraft Heinz cannot lower the price further without hurting its finances, the amount also represents a premium of 9.8 times Maxwell House's operating earnings of $255 million, the Post said, citing Piper Jaffray.
Why It's Important
Maxwell House's share of U.S. fresh and instant coffee market sales has fallen from 8 percent in 2013 to 6.7 percent in 2018, the Post said, citing Euromonitor International.
The coffee business is one potential divestiture as struggling Kraft Heinz attempts to stabilize its business, the Post said.
Credit Suisse has been hired to review options for the Maxwell House Coffee business, CNBC reported in February.
What's Next
The packaged food company — of which Berkshire Hathaway Inc. (NYSE: BRK-A) (NYSE: BRK-B) has a 26.7-percent stake — also recently put its Ore-Ida brand up for sale, seeking up to $2 billion, CNBC reported this week.
On Monday, Kraft Heinz hired ex-Anheuser-Busch InBev NV BUD marketing executive Miguel Patricio as CEO.
Kraft Heinz shares were trading up by 0.68 percent to $32.74 at the time of publication Friday.
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