Kraft Foods Group and H.J. Heinz Co. announced Wednesday morning that the two companies would merge, creating a food giant with revenues around $28 billion. The deal will create a combination that will together control products from the two companies’ namesakes to household staples such as Oscar Mayer deli meats and Philadelphia Cream Cheese. The terms of the deal call for Kraft shareholders to have a 49% stake in the combined company and to receive a special cash dividend of $16.50 per share. Heinz’s owners–PE house 3G and Berkshire Hathaway–will own 51% of the new company, and the two will contribute $10 billion in equity to pay out the dividend.
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