Kraft Foods Group and Heinz are to merge creating what the companies say will be the third-largest food and beverage company in the US.

The deal was engineered by Heinz’s owners, the Brazilian investment firm 3G Capital, and billionaire investor Warren Buffett’s Berkshire Hathaway.

Current Heinz shareholders will own 51% of the combined company with Kraft shareholders owning a 49% stake.

The combined company’s brands will include Kraft, Heinz, and Oscar Mayer.

Warren Buffett, Berkshire Hathaway chief executive, said: “I am delighted to play a part in bringing these two winning companies and their iconic brands together.

“This is my kind of transaction, uniting two world-class organizations and delivering shareholder value. I’m excited by the opportunities for what this new combined organization will achieve.”

Alex Behring, chairman of Heinz and the managing partner at 3G Capital, said: “By bringing together these two iconic companies through this transaction, we are creating a strong platform for both US and international growth.”

3G and Berkshire Hathaway bought Heinz two years ago for $23 billion and took the company private in 2013.

Kraft shareholders will receive a special cash dividend of $16.50 per share as part of the deal.

A special dividend payment of approximately $10 billion is being funded by Berkshire Hathaway and 3G Capital.

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