Brazilian private equity firm 3G Capital is in negotiations to acquire US-based food products maker Kraft Foods Group, according to media reports.
The Wall Street Journal, citing people familiar with the matter, reported that 3G Capital is in advanced talks to buy Kraft Foods through its H.J. Heinz Co unit in a deal that would be valued at more than $40bn (£26.8bn, €36.6bn).
Sources noted the deal could be announced soon, but they cautioned that the talks could fall apart as well.
Following the news, shares in Kraft rose more than 16% in after hours trading, after they closed regular trading at $61.33 on 24 March.
3G partnered with Warren Buffett's Berkshire Hathaway to acquire Ketchup maker H.J. Heinz Co for $23.2bn in 2013. If the deal is completed, Kraft is expected to be merged with H.J. Heinz, creating a mammoth company in the US food industry.
Kraft, the maker of Velveeta cheese and Oscar Mayer meats, has been struggling with changing consumer tastes that dented its sales. It reported a loss for the fourth quarter of 2014 as consumers opted to buy fresher foods with higher quality ingredients.
3G Capital has been looking to take advantage of the difficult situation of consumer companies, and it previously raised about $5bn for potential deals.
The company is already a big player in the food sector, having acquired a number of big names recently.
In 2010, 3G took private fast-food restaurant Burger King Worldwide Inc. In 2014, 3G bought Canadian coffee-and-doughnut retailer Tim Hortons Inc through its Burger King holding with the help of Buffett.