In a deal that touches the taste buds of several generations, Kraft Foods Inc. will sell the business that makes its familiar cube-shaped caramels.
An investment group made up of Texas Pacific Group of Fort Worth, Texas, and InterWest Partners of Menlo Park, Calif. will buy the Kraft caramel and marshmallow businesses.
Kraft caramels, introduced in 1933, have long been popular around Halloween, when the package traditionally includes a bundle of wooden sticks and a recipe for caramel apples. The deal also includes Kraft Fudgies, Kraft Jet-Puffed marshmallows and Kraft Marshmallow Creme.
The businesses employ about 575 people at three Kraft divisions.
Philip Morris Cos., Kraft’s owner, has been trying to sell Kraft’s low-profit businesses and focus on highly profitable lines such as Kraft cheese and Maxwell House coffee.
Philip Morris wants to keep only the Kraft businesses that produce double-digit returns.