Last updated on August 30th, 2022 at 03:40 pm
The stalking horse bid submitted by Flowers Foods Inc. for the majority of the assets related to Hostess Brands Inc.’s bread business, including the Butternut, Home Pride, Merita, Nature’s Pride and Wonder brands, will be the bid presented for approval to the U.S. Bankruptcy Court as no other qualified bids were received for those assets.
Thomasville, Ga.-based Flowers has agreed to pay $360 million for the majority of the bread business assets. The agreement includes, in addition to the brands, 20 bakeries, 38 depots and other assets.
“We are pleased Flowers won the bid for Hostess’ primary bread brands and bakeries without the need for an auction,” said George E. Deese, Flowers Foods’ chairman of the board and CEO. “Now we move forward with the next step, which is the bankruptcy court review. Following that, the transaction will continue through the regulatory process before it can be finalized. We expect it could be several months yet before it’s finalized.”
If Flowers is ultimately successful in its acquisition of these assets, they will fit with the company’s long-term growth objective to reach more of the U.S. population with its fresh breads, buns and rolls.
“Since 2004, our company has expanded the reach of our fresh bakery products from about 38 percent of the U.S. population to more than 70 percent today,” Deese said. “We accomplished this by expanding into new markets from our existing bakeries, building new bakeries, and through strategic acquisitions. We have proven experience in integrating acquisitions, having completed more than 100 since 1968 and three significant ones in just the last three years—Tasty Baking, Lepage Bakeries and the Sara Lee and Earthgrains brands in California.”
Grupo Bimbo selected winning bidder of Beefsteak bread business
In a separate transaction, Grupo Bimbo, S.A.B. de C.V. was selected as the winning bidder for the assets related to Hostess’ Beefsteak bread business at the conclusion of Thursday’s auction. Grupo Bimbo has agreed to pay $31.9 million for the Beefsteak assets. It topped Flowers’ stalking horse bid of $30 million.
Hostess will ask the U.S. Bankruptcy Court for the Southern District of New York to approve both transactions (Flowers and Grupo Bimbo) at a hearing March 19.
“The proposed sales will result in significant proceeds for the benefit of the company’s stakeholders and ensure the beloved bread brands can continue to be enjoyed for years to come,” said Hostess Brands Chairman and CEO Gregory F. Rayburn.
As previously announced, Hostess Brands also is pursuing the sale of its remaining brands, including Hostess, Dolly Madison, Drake’s, Sweetheart, Eddy’s, Standish Farms and Grandma Emilie’s.
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