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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
percent 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 percent 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.
"The ability to price has changed, and that's huge," Buffett
said.
(Reporting by Jonathan Stempel and Jennifer Ablan in New York;
Editing by David Goodman and Jeffrey Benkoe
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