Berkshire Hathaway reported a $3.76 billion write-down for its shares in Kraft Heinz during its second quarter.
This write-down reveals Berkshire Hathaway’s admission that its initial investment into the food conglomerate was overvalued and is now correcting course. Berkshire Hathaway holds over 27% of all Kraft Heinz shares.
As a result, Berkshire Hathaway reported a 4% decrease in quarterly operating profit. The holding company still totes over $344 billion in cash.
Heinz sold its shares to Berkshire Hathaway in 2013, two years before the food company merged with Kraft. Ever since, the company has altered its food products for healthier alternatives.
For example, Kraft Heinz removed dyes from its Kraft Mac and Cheese, switching to turmeric and paprika for its orange color in 2016.
Kraft Heinz announced last month that it will put an end to chemical dyes in all its products by 2027. According to the company’s sales data, 90% of its products are already free of dyes.
HEINZ ROLLS OUT PLAN TO HALT USE OF FOOD DYES IN TWO YEARS
Before this announcement, Berkshire Hathaway employees resigned from the Kraft Heinz board.
Kraft Heinz, the parent company of brands like Oscar Mayer, Kool-Aid, and Jell-O, met with Health and Human Services Secretary Robert F. Kennedy Jr. in March, along with other food companies. The meeting centered on reducing food additives in products — a pillar of the “Make America Healthy Again” movement.