Twinkies fans can rejoice! Two equity firms agreed Wednesday to buy the snack cake business from the bankrupt Hostess Brands Inc. and could soon begin making the delicious yellow cakes.
Apollo Global Management and Metropoulos & Co. agreed to pay $410 million to purchase the brands Twinkies, Ho Hos, Ding Dongs and Donettes snack cakes. The deal includes five bakeries and certain equipment in addition to the Hostess and Dolly Madison products.
The equity firms submitted a stalking horse bid for the products and Hostess said it did not receive any other qualifying offers. Hostess will ask the U.S. Bankruptcy Court for the Southern District of New York to approve the transaction at a hearing on March 19. Hostess filed for bankruptcy protection in November and has been liquidating its assets.
"The agreement results in significant value for our stakeholders and we look forward to putting the proposed transaction before the court next week," said Hostess Brands Chairman and CEO Gregory F. Rayburn in a statement.
As previously announced, Flowers Foods Inc. 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.
In a separate transaction, Grupo Bimbo S.A.B. de C.V. was selected as the winning bidder for the assets related to the company's Beefsteak bread business at the conclusion of a Feb. 28 auction. Grupo Bimbo has agreed to pay $31.9 million for the Beefsteak assets. The court will also consider approval of these brands at the same March 19 hearing for the Hostess and Dolly Madison brands.
On March 15, Hostess Brands will conduct an auction for its Drake's snack cake business and Sweetheart, Standish Farms, Grandma Emilie's and Eddy's bread businesses. The combined stalking horse bids for those assets total approximately $56.6 million.
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