Kraft Heinz splits 🍅🥫

🌞 Good Morning, Chai Fam- Happy Wednesday!

Midweek sip check: India’s GST 2.0 is rattling automakers, Google just dodged a forced Chrome breakup, and gold is glittering at all-time highs. And in today’s Big Brew, we dig into why Kraft Heinz is breaking itself apart. Let’s pour into it.

📰 Chai Shots

• 🥫 Kraft Heinz Splits After Merger Flop: Nearly a decade after Warren Buffett helped engineer the $45B Kraft–Heinz merger, the packaged-foods giant is calling it quits. Shares tumbled 7% after the announcement as investors weighed execution risks. More in the Big Brew 👇

• 📊 Reliance plans $2B ABS deal: Mukesh Ambani’s Reliance is preparing to raise ₹1.8 lakh crore via asset-backed securities, one of India’s largest such transactions. The deal, arranged by Barclays, will be backed by loans tied to its telecom and infrastructure arms, giving institutional investors a chance to buy into high-grade assets.

• ⚖️ India fights US copper tariffs: New Delhi has taken Washington to the WTO after the U.S. slapped a 50% levy on Indian copper exports. India argues the move is a disguised safeguard measure that violates trade rules, escalating an already tense tariff battle.

• 🌐 Google dodges Chrome breakup: In a landmark antitrust case, a U.S. judge ruled Google won’t have to sell its Chrome browser, but it must share valuable search data with competitors and stop locking up exclusive deals. Alphabet’s stock soared over 8% after the ruling, while Apple — which makes ~$20B a year from its Google partnership — also gained.

📊 Market Masala

• 📉 Sensex, Nifty end lower: Benchmarks slipped as investors stayed cautious before the GST Council meeting. Sensex closed down 207 points at 80,158 while Nifty fell 45 points to 24,580, dragged by autos and banks. Mid- and small-caps bucked the trend with modest gains, highlighting selective optimism.

• 🏦 SBI taps offshore market: State Bank of India raised $500M through 5-year bonds at a 4.5% coupon, cheaper than its 2024 borrowing cost. The stronger terms follow S&P’s upgrade of India’s sovereign rating, which has made global investors more comfortable lending to Indian banks.

• 💰 Next-gen GST reforms coming: FM Nirmala Sitharaman confirmed that GST 2.0 will focus on simplifying compliance and cutting costs, especially for MSMEs and startups. The Council meets this week to finalize key changes that could reshape indirect taxation and ease the burden on small businesses.

• 🚗 Auto sector fears GST cess losses: Automakers and dealers are worried about over 600,000 unsold cars stuck with compensation cess liabilities that may not carry over under GST 2.0. Dealers say blocked credits could hit working capital, prompting OEMs like Maruti and M&M to slow down SUV dispatches ahead of the transition.

• 🛍️ Flipkart rolls out AI makeover: Ahead of its Big Billion Days sale, Flipkart is betting big on AI to boost discovery and personalization. It’s also launching “Creator Cities” — large-scale studios for influencers — to ramp up video shopping and keep Gen Z shoppers hooked.

🌏 Global Masala

• 💊 US floats 200% drug tariffs: The Trump administration is considering duties of up to 200% on imported medicines, a radical move that could drive up U.S. drug prices and trigger shortages. India, a key supplier of generics, has been temporarily excluded, reflecting how dependent America is on Indian pharma supply chains.

• 🤖 OpenAI buys Statsig for $1.1B: ChatGPT-maker OpenAI acquired product-testing startup Statsig in an all-stock deal to strengthen its Applications division. It also reshuffled leadership, launching an “OpenAI for Science” group and bringing in Statsig’s CEO as its new CTO of Applications.

☕ The Big Brew🥫 Kraft Heinz Splits After Struggling To Grow

For years, Kraft Heinz has been behind some of the most iconic kitchen staples around the world — from ketchup and cheese slices to mac & cheese boxes. But the 2015 mega-merger that promised growth never delivered, and now the company is breaking itself into two.

• 🔪 The breakup plan: Global Taste Elevation Co. will house sauces, spreads, and ready-to-eat meals 🍯🥪 with ~$15.4B in sales, while North American Grocery Co. will focus on packaged staples like Oscar Mayer 🌭, Kraft Singles 🧀, and Lunchables 🍱 with ~$10.4B in revenue.

• 📉 Why this matters: Shares have lost almost 70% since the merger. Health-conscious consumers started avoiding processed foods 🥗, private-label supermarket brands got stronger 🛒, and Kraft Heinz failed to keep up. Even Warren Buffett, who backed the deal, admitted he’s “disappointed” 😔.

• 💸 The cost: The split will cost ~$300M and is expected to be complete by 2026. Management hopes this will simplify decision-making and free up each company to focus better.

🔍 What does this mean for India?

• 🇮🇳 No direct impact on your grocery cart: Kraft Heinz doesn’t dominate Indian kitchens the way it does in the U.S. (here it sold its India business, including Complan, to Zydus in 2018).

• 🌍 Global trend watch: This split is part of a bigger story of global food giants struggling with changing tastes, high tariffs, and pressure from local players. For Indian FMCG majors like ITC, HUL, and Tata Consumer, it’s a reminder that agility matters more than size.

• 📊 Investor angle: If global packaged food valuations get hit, Indian consumer companies could actually look stronger to foreign investors who want exposure to fast-growing, value-conscious markets.

🚀 Startup Scoop

• 💊 PlatinumRx raises $6M: The online pharmacy, which specializes in substitute medicines with identical compositions, raised $6M to expand fulfillment centers, strengthen supply chains, and grow its brand presence.

• 🧴 Tuco Kids Bags $4M: The children’s personal care brand will expand distribution across online and offline channels, ramp up marketing, and add more kid-safe skincare and haircare products to compete with Johnson & Johnson and Mamaearth.

• 🚌 LeafyBus Secures $4.1M: The e-bus operator will grow its fleet from 10 to 100 within two years, expanding intercity routes across North, East, and South India.

• 🍕 Kitchens@ Eyes ₹800 Cr Buyout: The cloud kitchen player is in talks to acquire Popo Ventures (Pizza Bakery, Paris Panini, Smash Guys) but must first raise fresh capital.

🤓 Chai Break Trivia

Did you know 🥇: Olympic gold medals today are mostly silver with a thin gold coat. The last time solid-gold medals were awarded was over a century ago, at the 1912 Games.

🔮 What’s Brewing Next

• 📑 Urban Company & Boat IPOs Cleared: Sebi has approved 13 IPOs including Urban Company’s ₹1,900 crore listing and Boat’s parent Imagine Marketing, setting up a busy H2 for the markets.

☕ That’s a wrap! GST drama, Google’s big legal win, and a ketchup empire splitting in two—what a midweek brew. See you tomorrow with more masala.