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Shareholders shop for discounted products at the Kraft Heinz booth at the annual Berkshire Hathaway shareholder meeting in Omaha, Neb., on May 4, 2019.

SCOTT MORGAN/Reuters

Kraft Heinz Co. said on Thursday that it plans to sell its nuts business - including most Planters and Corn Nuts products - to Hormel Foods Corp. for $3.35 billion, sending shares up 6%.

The Chicago-based company has been trying to streamline its portfolio and focus on more accretive brands, having faced criticism for years about losing out to private label products because it is in too many categories to focus on key brands. In September, Kraft Heinz said it would sell its natural cheese business to French dairy company Groupe Lactalis for $3.2-billion.

“Planters is one of the brands most affected by private label in our portfolio. It’s also, of course, affected as a commodity,” chief executive Miguel Patricio said in a statement.

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“We must focus on areas where we see the greatest competitive advantage.”

Patricio said in an interview with Reuters the Planters deal gives Kraft Heinz the flexibility to invest internally, make acquisitions or pay down debt. He declined to comment on what brands Kraft Heinz is interested in buying but said the company is “not in any negotiation at the moment.”

Kraft Heinz’s nuts business contributed about $1.1 billion to net sales in 2020.

The deal, which is expected to close in the first half of 2021, includes global intellectual property rights to the brands, subject to existing third-party licenses.

Kraft Heinz also beat analysts’ estimates on Thursday for fourth-quarter revenue as people under pandemic lockdown during the holidays bought more packaged food products like Mac and Cheese, Heinz ketchup and Oscar Meyer meat slices.

“No large-cap food company has benefited more from the COVID-19 era than Kraft Heinz, with strong non-promoted sales growth and much needed balance sheet relief,” Evercore ISI analyst David Palmer wrote in a recent note.

Sales grew 6.2% to $6.94 billion in the three months ended Dec. 26, beating the average estimate of $6.82 billion, according to Refinitiv data.

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Adjusted net earnings rose to 80 cents per share from 72 cents per share a year earlier, beating estimates of 74 cents per share.

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