Company: KHC
Filing Date: 2025-10-29
Form Type: 10-Q
Source: 0001637459-25-000166
Chunk: 179

Company: Kraft Heinz Co
Filing Date: 2025-10-29
Form: 10-Q
Item: Part I, Item 8
Chunk 179
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, results of operations, or cash flows.

The Separation may adversely impact our ability to access the capital markets and our cost of capital.

The Separation may have the effect of, among other things: 

•Requiring us to dedicate significant cash flow to our debt, including, without limitation, the payment of principal and interest, payment of costs associated with the refinancing, repayment, redemption, repurchase, defeasance, discharge or exchange of the Company’s outstanding debt, and payment of costs associated with the Separation, which will reduce funds we have available for other purposes. 

•Exposing us to interest rate risk at the time of refinancing outstanding debt or on the portion of our debt obligations that are issued at variable rates. 

•Increasing the borrowing costs associated with the re-allocation or taking on of new debt. 

•Although we expect to maintain investment grade ratings, resulting in downgrades of our credit ratings leading to increased borrowing costs to the Company. 

Our primary sources of liquidity to finance operations, including stock repurchases and dividends on our common stock, is cash generated by our businesses and access to the debt capital markets. Further, in connection with the Separation, we may repay, redeem, repurchase, defease, discharge or exchange all of our senior notes, of which there are approximately $20.9 billion aggregate principal amount outstanding, with maturities in years starting in 2026 through 2050. If our ability to continue to raise money in the debt capital markets is impaired, or if there is a significant increase in the cost of debt, there could be an adverse effect on our liquidity. If we are unable to generate sufficient cash flow or maintain access to adequate external financing, it could impact our current operations, activities under our current and future stock buyback programs, and our growth opportunities, which could have a material adverse effect on our business, financial condition, results of operations, or cash flows.

If the Separation and/or certain related transactions do not qualify as transactions that are generally tax-free for U.S. federal income tax purposes, we and our stockholders could be subject to significant tax liabilities.

Notwithstanding that we intend to structure the Separation to generally be a tax-free transaction, there is no assurance that the spin-off and/or certain related transactions will qualify for this treatment. If the spin-off and/or certain related transactions are ultimately determined to be taxable, we and our stockholders could be subject to significant U.S. federal income taxes.

Following the Separation,