Heinz to combine with Kraft in deal backed by Buffett, Brazilian firm, creating food giant

H.J. Heinz Co. is buying Kraft Foods Group Inc., creating what the companies say will be the third-largest food and beverage company in North America.

The deal was engineered by Heinz's owner, the Brazilian investment firm 3G Capital, and billionaire investor Warren Buffett's Berkshire Hathaway.

Kraft shareholders will receive stock in the combined company and a special cash dividend of approximately $10 billion, or $16.50 per share.

Current Heinz shareholders will own 51 percent of the combined company, with Kraft shareholders owning a 49 percent stake.

The combined company's brands will include Kraft, Heinz, Oscar Mayer and others.

Both companies' boards have unanimously approved the deal, which is targeted to close in the second half of the year. It still needs approval from Kraft shareholders.