Kraft Heinz adds Dilts, Schlotman as it agrees to sell coffee

By Nathan Brooks

Kraft Heinz expects to receive $500 million in after-tax cash from a $650 million North American coffee divestiture while adding two directors effective Wednesday.

Nordstrom CFO Kelly Dilts and former Kroger CFO J. Michael Schlotman join the board as the company advances a $700 million transformation plan, according to a Wednesday press release and securities filing.

Kraft Heinz, headquartered in Chicago and Pittsburgh, sells Heinz ketchup, Kraft macaroni and cheese, CapriSun, Jell-O and other packaged food and beverage brands. The company said the appointments add “deep consumer, financial and operational expertise” as it strengthens its portfolio and fosters growth.

CEO Steve Cahillane said: “Kelly and Mike have spent their careers deeply connected to the consumers, customers and market forces that shape our industry. Their experience leading scaled businesses through change will be invaluable as we sharpen our focus, strengthen our brands and continue to build a more profitable Kraft Heinz.”

New directors bring operating depth

• J. Michael Schlotman served 34 years at Kroger, including 19 as its CFO, before retiring in December 2019, according to his LinkedIn profile. Since leaving Kroger, he has held board seats at Kellanova, formed after the Kellogg Company’s split in 2023, Connetic Ventures and CVG Airport.
• Kelly Dilts has served as Nordstrom’s CFO since September 2025, joining after two years as Dollar General’s CFO, according to her LinkedIn profile. She took the post shortly after Nordstrom delisted from the NYSE and began operating as a private company, CFO Dive reported.

Dilts and Schlotman will receive compensation for their board service under Kraft Heinz’s non-employee director compensation standards, according to the filing with the Securities and Exchange Commission.

Both have run scaled operations. Scale is the useful part.

Coffee sale brings cash and a retained stake

Kraft Heinz said Wednesday that it agreed to divest its North American coffee business to an affiliate of private equity group One Rock Capital at an enterprise value of $650 million. The portfolio includes Maxwell House, Ethical Bean and Sanka.

Kraft Heinz will retain a 30% equity stake. The companies expect the deal to close in mid-2027 after regulatory approval.

On that $650 million enterprise value, Kraft Heinz expects $500 million in net cash proceeds after tax and will use the money to pay down debt. The company called the transaction “expected to be growth and margin accretive to Kraft Heinz.”

One Rock gets the brands. Kraft Heinz gets cash, debt reduction and a residual stake.

Cahillane called the transaction an “important step in simplifying and strengthening our portfolio,” he said Wednesday during the third-quarter earnings presentation.

“With this transaction, we can concentrate our capital and management attention where we see the greatest potential for growth and where we can create the most value for our consumers... and our shareholders,” he said in the earnings transcript.

The appointments and coffee divestment advance Cahillane’s strategy to return Kraft Heinz to sustainable, profitable growth.

Transformation meets a declining quarter

Cahillane, a Kellanova alum, took Kraft Heinz’s top executive chair in January as the company prepared to split into two entities to address ongoing food-industry headwinds, according to a December 2025 press release.

Shortly afterward, Kraft Heinz paused the planned separation. Cahillane said many of the company’s challenges were “fixable and within our control,” according to the full-year 2025 earnings report in February.

The company then announced a $600 million investment across marketing, research and development, and sales to boost growth. Another $100 million investment followed in August, according to Marketing Dive. The two commitments total $700 million, matching the transformation figure cited in Wednesday’s board release.

Kraft Heinz’s third-quarter net income fell nearly 13% year over year to $536 million, while net sales declined 2% to $6.1 billion for the period ended Sept. 26.

The directors arrive with scale on their résumés and declining sales on the dashboard.

What does this change for suppliers and retailers?

Operationally, little changes overnight. Kraft Heinz disclosed no new pricing, supplier or assortment terms. The near-term change is where management attention and marketing resources go: portfolio focus, product development and retailer work.

For suppliers and retailers, that matters most in the two announced investments, which include pricing and product-development decisions. Cahillane said the company remains in “constructive” conversations with retailers.

“We want to be a tailwind for our retailers, not a headwind,” Cahillane said in Wednesday’s earnings transcript.

“And part of that comes through innovative thinking about how we make the aisle more dynamic, more interesting, how we bring more innovation, how we drive more traffic.”

The aim is directional, not contractual. No new trade terms accompanied Wednesday’s announcements.

One Rock’s affiliate takes the coffee business at close. Kraft Heinz keeps 30%, collects an estimated $500 million and redirects attention. The cash arrives in mid-2027; the turnaround must start sooner.