Hostess Brands has named McKee Foods and United States Bakery as the stalking horse bidders for its Drake’s cake business and various bread brands.
In a statement released late yesterday (28 January), Hostess said that McKee Foods has tabled an offer of approximately US$27.5m for Drake’s, which makes Devil Dogs, Ring Dings and Yodels. McKee currently makes Little Debbie snack cakes.
Under a separate agreement, United States Bakery, also known as Franz Family Bakery, has offered $28.85m for Hostess bread brands including Sweetheart, Eddy’s, Standish Farms and Grandma Emilie’s.
These stalking horse bids set baseline offers and are still subject to a competitive auction process.
Earlier this month, Hostess reached a stalking horse agreement with Flowers Foods who has offered $390m for bread brands including Wonder, Butternut, Home Pride and Nature’s Pride. The auction for these brands will be held next month (28 February).
Hostess is currently in the process of liquidating its business and selling off its assets and brands. The company received court approval to wind down its operations in November last year. The group is yet to announce a lead bidder for its iconic Twinkies brand. Pundits have suggested that Bimbo could be interested in some of Hostess’s cake assets.
