Many investors watch what Warren Buffett is buying, and tracking regular 13F filings from his iconic investment manager Berkshire Hathaway (BRK.B) is a simple way to do so.
These quarterly reports to the Securities and Exchange Commission (SEC) require disclosures of buys and sells by institutions that manage more than $100 million, such as mutual funds, hedge funds, pension funds, registered investment advisors and insurance companies.
Berkshire made waves in 2013 with its initial investment in Kraft and its resulting stake in Kraft Heinz (KHC) after a megamerger with peer Heinz. Berkshire’s 13F filings when it comes to this particular investment have been remarkably consistent since then.
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A decade ago, Berkshire reported 325,634,818 shares of KHC stock. As of its most recent SEC report in May, that figure is exactly the same.
Now, the market is abuzz about a potentially disruptive sale of Berkshire’s KHC stake. Say there’s merit to the rumors: Why would Warren Buffett and Berkshire Hathaway want to sell?
And what does it mean for BRK.B and KHC shareholders if such a big-time transaction takes place?
Kraft Heinz merger and recent history
Heinz ketchup was introduced in 1876, so the roots of this company go back a long way. The last 15 years of corporate history are particularly relevant to the recent troubles at KHC, however.
In 2012, Kraft Foods spun out its snack food offerings as Mondelez International (MDLZ). The idea was that Oreo cookies and Cadbury chocolates had a more global and growth-oriented footprint than other processed-food staples in the product portfolio.
Mondelez was actually the bulk of the operations at the time, valued at about $36 billion compared with the $19 billion staples arm that was left as Kraft.
In 2013, Warren Buffett and Berkshire Hathaway partnered with 3G Capital Management to buy the whole of H.J. Heinz for $23.3 billion and took the firm private.
The initial Buffett-Berkshire stake was nearly $10 billion, adding up to about 325 million shares.
In 2015, Kraft and Heinz were mashed up in a $45 billion merger. The deal resulted in a combined debt load of approximately $33 billion at the new entity.
Management cut the dividend, reduced spending on product development, and eschewed general long-term planning.
Consumers were already skeptical of legacy packaged foods and investors were eager for exciting growth stories, and as Main Street abandoned its products Wall Street gave up on KHC.
Berkshire’s initial stake remains unchanged at roughly 325 million shares, however, making it a rare constant over this tumultuous period.
Will Buffett and Berkshire sell Kraft Heinz?
Berkshire has accumulated dividends on its shares along the way. But from a share-appreciation perspective, the deal has been a dud.
The combined KHC began trading around $46 post-merger but closed at $28.78 July 24, a loss of more than 35%. Worse, KHC stock is down a nasty 70% from its short-lived high in 2017.
Given this underperformance – and with Warren Buffet set to celebrate his 95th birthday in August – it seems natural for Berkshire to consider closing the books on the past and looking to the future.
Besides, Berkshire’s investment thesis has prioritized income-generating stocks that offer strong cash flow, and KHC clearly doesn’t fit that mold. Not only did Kraft Heinz execute a 2019 dividend cut, it remains bloated with $20 billion in remaining debt that causes a persistent drag on finances.
On top of that, the most glaring proof that an exit may be forthcoming is that Berkshire representatives have already quit the Kraft Heinz board.
With a massive stake that’s more than a quarter of all shares, however, any exit will not be easy. That’s where some financial engineering – including a breakup of Kraft and Heinz – could come in.
Berkshire’s departing board members have publicly admitted pushing for merger-and-acquisition explorations recently, and such a deal could provide built-in purchasing power through restructuring and assistance from institutional buyers.
Smaller divestitures have happened at Berkshire, including a recent deal to sell its infant and specialty food division to NewPrinces, a top food producer in the region.
But recent challenges seem to be structural and demand a big move.
Buffet, Berkshire and what’s next for KHC stock
Berkshire could theoretically muddle through in the face of all this. But as the recent rumor mill seems to indicate, it’s more likely they will use any retransformation at KHC as an opportunity to cut and run.
For those who want context on what may happen, it’s worth looking back at how previous stocks performed after Berkshire Hathaway sold off a significant stake.
Most recently, in May Berkshire announced it sold some 14 million shares of Citigroup (C), according to its 13F filing. To be clear, this transaction was announced in May but occurred across the January 1-to-March 31 reporting period.
However you slice it, those 14 million shares didn’t hold back C stock, which has rallied nearly 35% in 2025.
Just as noteworthy is that average volume for Citigroup is almost exactly the same amount at 14 million shares daily. In other words, Berkshire could have satisfied all market demand for one session if no one else on the planet sold a single share of Citi.
Unfortunately daily volume in KHC is also about 14 million shares – meaning the total stake adds up to more than a month of trading volume rather than just a single day.
So Berkshire doesn’t have to dump all its shares at once. However, a slow bleed of selling could provide a public signal that causes other investors to sell as well, creating a negative feedback loop that punishes shares.
Berkshire’s next 13F reporting date is August 14, and it will be closely watched. The bottom line is a stake like this is hard to get rid of without making waves.
Which, of course, is why Berkshire may be so eager for an alternative arrangement alongside a merger, breakup or other structural change.