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WHITE PLAINS, N.Y. -- Three months ago, there were many reports about the death of Twinkies. But with a bankruptcy court's approval, it appears Twinkie the Kid will live to ride again.
Judge Robert Drain of the U.S. Bankruptcy Court for the Southern District of New York in White Plains, N.Y., granted approval for Hostess Brands Inc. to hold auctions for its brands, including Twinkies, Drake's and Wonder Bread. The approval comes three months after the Irving, Texas-based company filed for bankruptcy after negotiations with the Bakery, Confectionary, Tobacco and Grain Millers Union broke down and the union took to the picket line, as CSNews Online previously reported.
In his ruling Monday, Drain gave the go-ahead nod to Flowers Foods Inc., McKee Foods Corp., United States Bakery Inc., Apollo Global Management LLC and C. Dean Metropoulos & Co. as the so-called stalking-horse, or lead bidders for most of Hostess's cake and bread brands, setting the thresholds other suitors will have to exceed. A sale hearing is set for March 19, according to Reuters.
According to the news outlet, Apollo and Metropoulos offered as much as $410 million for the Hostess snack-cake business, which includes Dolly Madison brands, five bakeries and equipment.
As CSNews Online previously reported, Thomasville, Ga.-based Flowers Foods inked two purchase agreements as a stalking horse bidder for certain Hostess Brands assets. One pact calls for it to purchase the Wonder, Nature's Pride, Merita, Home Pride and Butternut bread brands, 20 bakeries and approximately 38 depots for $360 million. The other deal includes the purchase of the Beefsteak brand for $30 million. That auction is set for Feb. 28.
Flowers Foods is the second-largest producer and marketer of packaged bakery foods for retail and foodservice customers in the United States. It operates 44 bakeries. Among its top brands are Tastykake and Nature's Own.
In addition, McKee, maker of Little Debbie snacks, agreed to pay $27.5 million for the Drake's product line. United States Bakery offered to buy the Sweetheart, Eddy's, Standish Farms and Grandma Emilie's bread brands, four bakeries and 14 depots, plus certain equipment, for $28.9 million. A March 15 auction date for Drake's and the four bread brands has been set, Reuters reported.