Flowers Said to Win Wonder Bread After No Other Offers
Flowers Foods Inc. (FLO), maker of packaged bakery foods, will buy the majority of the bread-making business of bankrupt Hostess Brands Inc., including its Wonder bread brand, a person familiar with the situation said.
Flowers, based in Thomasville, Georgia, will pay about $360 million for Hostess’s Wonder, Butternut, Home Pride, Merita and Nature’s Pride brands, 20 bread plants, 38 depots and other assets, after no other competing offers were submitted. Tomorrow’s planned bankruptcy auction will be canceled.
The auction for Beefsteaks bread will go forward tomorrow after the rye-bread brand received an offer from Grupo Bimbo (BIMBOA) SAB to challenge Flowers’ $30 million bid, according to the person familiar with the situation, who requested not to be identified as the talks are private.
Hostess will sell more bread and snack-cake brand assets next month, including the iconic Twinkies, with initial offers totaling about $466.4 million, according to court documents. Hostess Chief Executive Officer Greg Rayburn said Jan. 31 that so-called stalking-horse bids total about $858 million with about $100 million more for sale.
Apollo Global Management LLC (APO) and C. Dean Metropoulos & Co. have offered about $410 million for the Hostess snack-cake business, which includes Dolly Madison brands, five bakeries and equipment. Bids for the March 13 snack-cake auction must be submitted by March 11.
McKee Foods Corp., maker of Little Debbie snacks, made a bid of $27.5 million for the Drake’s brand. United States Bakery Inc. offered to buy the Sweetheart, Eddy’s, Standish Farms and Grandma Emilie’s bread brands, four bakeries and 14 depots, plus certain equipment, for about $28.9 million. Both initial offers will be tested at March 15 auctions. Bids are due by March 12 for both auctions.
Hostess will seek bankruptcy court approval to sell the assets to all the auction winners at a hearing scheduled for March 19.
Keith Hancock, a spokesman for Flowers, didn’t immediately respond to an e-mail seeking comment on the auction. David Margulies, a spokesman for Bimbo, declined to comment on whether the company had made an offer for the Beefsteaks brand. AnitaMarie Laurie, a spokeswoman for Hostess, declined to comment.
Flowers, established in 1919, produces and markets packaged baked goods for retail and food-service customers. The company’s top brands are Nature’s Own and Tastykake.
Hostess, founded in 1930, is liquidating after failing to reach an agreement with striking bakers on concessions to help the company emerge from its second bankruptcy.
Previously known as Interstate Bakeries Corp., Hostess left an earlier bankruptcy in 2009 under the control of buyout firm Ripplewood Holdings LLC and lenders. The company, based in Irving, Texas, entered bankruptcy again in January 2012.