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Mondelez and Kraft: A Storied History

While it’s far from a household name, few corporations in American history can claim a more storied history than Mondelez International Inc. Now, activist investor William Ackman is unveiling a $5.5 billion stake in the snack company and plans to push it to write a new chapter.

The latest twist has prompted MoneyBeat to revisit the company’s complicated family tree, which includes links with Philip Morris , General Foods, RJR Nabisco –and, most closely, Kraft Foods.

Here’s a timeline of the complicated relationship between Mondelez, Kraft and some other food giants, past and present.

1903: James L. Kraft begins selling cheese from a horse-drawn wagon in Chicago. By 1914, his company begins manufacturing cheese on its own.
1924: The company changes its name to Kraft Cheese Co. from J.L. Kraft & Bros. Co. and goes public on the Chicago Stock Exchange.
1928: Kraft merges with Phenix Cheese, which makes Philadelphia cream cheese.
1930: Kraft is acquired by National Dairy Products Corp.
1969: National Dairy Products Corp. changes name to Kraftco Corp.
1976: Kraftco Corp. changes names to Kraft Inc.
1980: Kraft Inc. merges with Dart Industries Inc., maker of Duracell batteries and Tupperware .
1985: Cigarette maker R.J. Reynolds merges with snack company Nabisco Brands, owner of brands such as Ritz and Oreo, in a $4.9 billion deal to form RJR Nabisco. (RJR Nabisco will soon become the target of the most legendary corporate raid of all time, but more on that later.)
1985: As part of a long diversification away from tobacco, cigarette company Philip Morris pays $5.6 billion to buy General Foods, owner of Oscar Mayer hot dogs, Entenmann’s pastries, Jell-O, Sanka coffee and Kool-Aid.
1986: Kraft spins off its non-food businesses. It also acquires Tombstone Pizza Corp.
1988: Kraft sells its Duracell battery business to buyout firm Kohlberg Kravis Roberts .
1988: Philip Morris buys Kraft for about $13 billion to combine the General Foods and Kraft brands under one roof.
1988: After a fierce bidding war engulfing some of the biggest Wall Street banks and investors in the world, KKR in 1988 wins a $25 billion takeover of RJR Nabisco, the deal chronicled in the business tome “Barbarians at the Gate.” (How this involves Kraft is coming up)
1995: Kraft General Foods is reorganized and a number of business lines are sold, including confections, bakery products and tablespreads. Brands included in these sales are Entenmann’s, Freihofer’s, Parkay and Touch of Butter
2000: Philip Morris adds Nabisco Holdings, which RJR Nabisco had just left as a separate company. The Nabisco purchase was eventually valued at around $19.2 billion. The cigarette giant then combines Nabisco with Kraft.
2001: Philip Morris spins off a small portion of its stake in Kraft Foods, which becomes publicly traded.
2007: Echoing the breakup of RJR Nabisco years earlier, Altria Group (the renamed Philip Morris), completes a spinoff of its majority stake in Kraft. Under pressure from investor Nelson Peltz, Kraft also agrees to sell its Post line of cereal – Grape-Nuts, Honey Bunches of Oats and more — to Ralcorp.
2010: Kraft closes a roughly $19 billion purchase of U.K. candy company Cadbury after a lengthy fight. Kraft also sells its Digiorno frozen pizza line to Nestle SA. Warren Buffett, whose Berkshire Hathaway Inc. was the largest shareholder of Kraft at the time, called both transactions “dumb.”
2011: Ralcorp decides to split its Post Foods cereal and private-label food businesses into two publicly traded companies. The deal throws a curveball into ConAgra Foods Inc.’s attempt to buy the entire company.
2012: Under pressure from Trian Fund Management LP, Kraft decides to split in two, spinning off its mature North American grocery business to highlight its global snack-food business. The larger global business–which includes Oreo, Cadbury, Wheat Thins, and other brands–is named Mondelez International Inc. The smaller company, dubbed Kraft Foods Group Inc., gets the Kraft cheese products, Maxwell House coffee, Jell-O, and Planters nuts, among other brands.
2012: After the Post cereal spinoff, ConAgra Foods Inc. agrees to acquire Ralcorp for $4.95 billion, making it the largest private-label food manufacturer in the U.S.
2013: Heinz sells itself for $23 billion to 3G Capital Partners and Warren Buffett’s Berkshire Hathaway Inc.
2013: Activist shareholder Nelson Peltz says in an interview on CNBC that his firm, Trian, is urging PepsiCo Inc. to acquire Mondelez International Inc. to create a global snack giant and spin off PepsiCo’s underperforming beverage business.
2014: Mr. Peltz wins a board seat at Mondelez but Trian ends its efforts to merge the food company with the snacks business of PepsiCo Inc.
March 2015: Kraft Foods Group and Heinz agree to merge, with Berkshire and 3G contributing $10 billion to pay a special dividend for Kraft shareholders. Berkshire and 3G end up owning just over half the combined Kraft Heinz Co., the fifth-largest food company in the world by sales, while the rest is publicly traded.
June 2015: Jana Partners takes a 7.2% stake in ConAgra and pressures the company to unwind the Ralcorp deal, which the company quickly agrees to do.
August 2015: Activist investor William Ackman unveils a $5.5 billion stake in Mondelez International Inc. The activist investor believes Mondelez has to grow revenues faster and cut costs significantly or sell itself to a rival. Mr. Ackman suggests that one potential buyer could be the newly formed Kraft Heinz.

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