Kraft Foods Inc said it would split itself into two listed companies, a global snacks business and a North American grocery business, and raised its full-year outlook on better-than-expected quarterly results.
The maker of Cadbury chocolate bars, Oreo cookies and Velveeta cheese said it expects to spin off its high-margin North American grocery business to shareholders by the end of 2012.
The grocery business -- with annual revenue of about $16 billion -- would include its U.S. beverages, cheese and convenient meals with brands like Maxwell House coffee and Jell-O desserts. The company would also include non-snack categories in Canada and its food service business.
The high-growth snacks company, with annual sales of $32 billion and brands such as Oreo cookies and Cadbury, would include its Europe and developing markets units and its North American snacks and confectionery businesses.
Separately, Kraft raised its full-year outlook as it reported better-than-expected quarterly results due to higher prices of its brands.
Shares of the company were up 3.5 percent before the bell at $35.50. They closed at $34.30 on Wednesday on the New York Stock Exchange.
(Reporting by Mihir Dalal in Bangalore; Editing by Saumyadeb Chakrabarty)