Kraft Heinz shares plunge after $15 billion write-down, investigation

The company disclosed the investigation and the write-down in its fourth-quarter earnings report, which it issued late Thursday. Kraft Heinz also said it lost $12.6 billion in the quarter.

The overnight stock price plunge represents a $3.2 billion hit alone for its largest investor, Warren Buffett’s Berkshire Hathaway, which owns more than 26 percent of the company’s outstanding shares.

Kraft Heinz divulged the receipt of a subpoena in October from the U.S. Securities and Exchange Commission related to its procurement operations. Those operations handle interactions with outside suppliers.

The company’s CFO, David Knopf, said during a conference call with analysts Thursday that the company conducted “a very thorough internal investigation” after it learned about the SEC scrutiny.

“We determined that we should have recorded $25 million in prior periods, which we booked in” the fourth quarter,” Knopf said. “And to put into context, that compares to our overall procurement spend of over $11 billion, which excludes big four commodities spend.”

Knopf said the company’s $15.4 billion write-down was related to the declining values of its food brands in three divisions: Kraft natural cheese, Oscar Mayer cold cuts, and its Canada retail business.

–With reporting by the Associated Press.