Hostess Said to Pick Apollo, Metropoulos as Lead Cake BidBeth Jinks and Cristina Alesci
Hostess Brands Inc., the bankrupt maker of Wonder bread and Twinkies, picked the team of Apollo Global Management LLC and C. Dean Metropoulos & Co. as the lead bidder for its cake brands, said two people with knowledge of the matter.
The assets include some facilities, said one of the people, who asked not to be identified because the process is private. The offer becomes the so-called stalking horse for an auction of the cakes business, meaning it sets the standard that other suitors have to beat. Hostess’s cake products include CupCakes, Ding Dongs and Ho Hos.
Hostess announced plans to liquidate in November after failing to reach an agreement with its striking bakers’ union on concessions. The union blamed management for failing to modernize and said it accepted big wage and benefit reductions after Hostess’s first bankruptcy, which ended in 2009. The Irving, Texas-based company filed for Chapter 11 protection again in January 2012.
Melissa Mandel Kvitko, a spokeswoman for Apollo with Rubenstein Associates Inc., declined to comment on the process. Daren Metropoulos, a principal at C. Dean Metropoulos, didn’t immediately respond to an e-mail seeking comment. The New York Post said yesterday that the parties probably would win the stalking-horse role.
Leon Black’s Apollo, based in New York, managed $109.7 billion in assets as of Sept. 30. C. Dean Metropoulos, based in Greenwich, Connecticut, is the private-equity firm that owns Pabst Brewing Co.
Flowers Foods Inc., the Thomasville, Georgia-based owner of brands including Nature’s Own and Tastykake, was earlier selected as the stalking-horse bidder for most of Hostess’s bread brands with a $360 million offer. Flowers is also the stalking-horse bidder for Hostess’s Beefsteak bread brand with a $30 million bid. That auction is scheduled for Feb. 28.
Yesterday, Hostess said United States Bakery Inc. offered to buy some other bread brands for $28.9 million while McKee Foods Corp., maker of Little Debbie snacks, agreed to pay $27.5 million for its Drake’s brand.
The case is In re Hostess Brands Inc., 12-22052, U.S. Bankruptcy Court, Southern District of New York (White Plains). The previous bankruptcy was In re Interstate Bakeries Corp., 04-45814, U.S. Bankruptcy Court, Western District of Missouri (Kansas City).