Why the Kraft Heinz Reversal Is Great News for Berkshire Hathaway Investors
Key Points
Berkshire Hathaway, under Warren Buffett, took a very hands-off approach with its investments.
Investors still don't know what to expect now that Greg Abel has taken over as CEO, but they are slowly finding out.
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One of the biggest financial news stories in 2025 was the announcement that Warren Buffett would retire as CEO of Berkshire Hathaway (NYSE: BRKA)(NYSE: BRKB). At this point, Greg Abel, Buffett's successor, has made two notable decisions around Kraft Heinz (NASDAQ: KHC). And both say a lot about what Berkshire Hathaway investors can expect in the future.
Buffett was not pleased with Kraft Heinz
Warren Buffett has described investing in Kraft Heinz as a mistake. That revelation came as the consumer staples maker announced material write downs, which Buffett admitted was an indication that he had overpaid for the business. Every investor makes mistakes, even the co-called Oracle of Omaha.
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That said, Buffett didn't really change his basic investment approach despite this admission. He continued to take a hands-off approach despite the company's ongoing struggles. And even when Kraft Heinz announced it was breaking into two businesses, effectively undoing the merger, he didn't do anything more than state that he was displeased with the decision.
Greg Abel didn't wait long to act on Kraft Heinz
When Greg Abel took over as CEO of Berkshire Hathaway, however, he made it clear that he was displeased with Kraft Heinz and that he intended to sell the stock. Abel quickly lived up to the expectation that he would be a more active investor than Buffett. What happened next, however, is even more important.
Shortly after Abel made his displeasure clear, Kraft Heinz changed course. The consumer staples company's new CEO announced that the business had material opportunities for improvement as it currently existed and that he would focus on them. It isn't clear that Abel's intentions had any impact on the decision to call off the business breakup, but Berkshire Hathaway owns just over 27% of Kraft Heinz. It is hard to believe that Abel had no impact on Kraft Heinz dramatic direction change.
Berkshire Hathaway is rethinking its position, too
What's even more telling, however, is that Greg Abel has now indicated that Berkshire Hathaway isn't going to sell its Kraft Heinz stake. There are two takeaways here. First, Greg Abel appears to have taken a more active role with a big investment and got his way. Second, Abel is clearly willing to adjust as the landscape changes, given that he changed paths after Kraft Heinz announced it wouldn't split. If you are a Berkshire Hathaway investor, you should probably view the ongoing Kraft Heinz saga as a telling and positive indication for the conglomerate's future under its new CEO.
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Reuben Gregg Brewer has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Berkshire Hathaway. The Motley Fool recommends Kraft Heinz. The Motley Fool has a disclosure policy.
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