Kraft Foods announced plans to break-up the group in August last year

Kraft Foods announced plans to break-up the group in August last year

Kraft Foods is to cut around 1,600 jobs across North America as it prepares to split the business into two.

Kraft said today (17 January) that around 40% of the job cuts will come from the company realigning its US sales division. Around 20% of roles to be cut are currently vacant, the company said.

All cuts will take place in US and Canada in 2012. Kraft said it anticipates the completion of its US sales reorganisation by 1 April.

The job cuts come ahead of Kraft's business split, announced in August last year. It plans to create a global snacks company and a North America-based grocery firm before the end of 2012.

As part of the plan, Kraft will split its drinks brands, with Tang powdered beverages sitting in the global snacks business and Capri Sun joining the grocery business. Beverages contributed to 18% of Kraft's net sales in 2010. 

Kraft's beverages business unit in Tarrytown, New York, and its Planters brand in East Hanover, New Jersey, will relocate to the Chicagoland area by December. Employees will have the option to transfer with their businesses, the company said.

Kraft also will close its Glenview, Illinois, management centre by the end of 2013, it said. Overall, Kraft will reduce its US management centres from four to two.

"When we announced our decision to create two world-class companies last August, we said both would be leaner, more competitive organisations," said Kraft Food's chairman and CEO, Irene Rosenfeld.

"For the past year, the North American team has been working to streamline operations to deliver sustainable top-tier performance and continue to invest in our brands," she added. "We're confident that this transformational work will improve effectiveness and fuel the future growth of both companies."

Kraft employs around 127,000 people worldwide, according to 2010 figures.