NEW DELHI :
Warren Buffett said on Monday that his company Berkshire Hathaway Inc overpaid in the merger that created Kraft Heinz Co.
Berkshire and Brazilian firm 3G Capital had teamed up in 2015 to combine the former Kraft Foods with their H.J. Heinz. They own about half of the merged company, with Berkshire holding a 26.7% stake.
"We overpaid for Kraft," Buffett said on CNBC television. "I was wrong in a couple of ways on Kraft Heinz."
Buffett spoke four days after Kraft Heinz took a $15.4 billion writedown for its Kraft and Oscar Mayer brands and other assets, slashed its dividend, and said the U.S. Securities and Exchange Commission was probing its accounting. Kraft Heinz also said a turnaround likely wasn't imminent.
Kraft Heinz tumbled 27.5% on Friday, causing Berkshire to lose $4.3 billion on its stake.
Buffett said he had learned about the SEC probe about seven to 10 days before it was announced.
Greg Abel, a Berkshire vice chairman who is widely considered a candidate to succeed the 88-year-old Buffett as Berkshire's chief executive officer, sits on Kraft Heinz's board.
Kraft Heinz's announcement raised questions about 3G Capital's financial strategy for Kraft Heinz, whose brands include Jell-O, Kool-Aid and Philadelphia cream cheese, and whether it appears increasingly out of step with consumers seeking healthier, fresher alternatives to processed food products.
Buffett acknowledged these changes, but said greater pressure is coming from retailers such as Amazon.com Inc, Walmart Inc and Costco Wholesale Corp, including through the latter's Kirkland brand.
This story has been published from a wire agency feed without modifications to the text.