Flowers Foods Inc. has signed two asset purchase agreements with Hostess Brands Inc. as the “stalking horse bidder” for certain Hostess assets. One of the agreements provides for the purchase by Flowers of the Wonder, Nature’s Pride, Merita, Home Pride, and Butternut bread brands; 20 bakeries; and approximately 38 depots for a purchase price of $360 million. The other agreement provides for the purchase by Flowers of the Beefsteak brand for $30 million.
The transactions are subject to a court-approved bankruptcy process being initiated by Hostess. If Flowers’ “stalking horse” bids are approved by the bankruptcy court, the bids would then be subject to a competitive auction process to be held several weeks from now. The company would expect to close the transactions shortly following court approval if it is selected as the winning bidder. The transactions also are subject to regulatory clearance.
Flowers Foods has previously stated its interest in acquiring certain Hostess assets should they become available. “This agreement is consistent with Flowers Foods’ long-term growth objectives to reach significantly more of the U.S. population with its fresh breads, buns, and rolls,” said George E. Deese, Chairman and CEO of Flowers Foods. “We believe these assets would enhance our ability, over time, to provide more U.S. consumers with quality baked foods at a good value through existing and new retail and foodservice customers.”
Flowers Foods, established in 1919, produces and markets packaged bakery foods for its retail and foodservice customers. The company’s top brands are Nature’s Own and Tastykake.
Hostess, based in Irving, Texas, announced in November that it was shutting down its business and selling its bread, snacks, and cakes brands along with its 33 bakeries and other operations. The Hostess snack food brands—which include Twinkies, Ho-Hos, and Drake’s cakes—will be sold off separately.