IRVING, TX -- Hostess Brands Inc. has obtained U.S. Bankruptcy Court approval to sell its Drake's snack cake business and its remaining bread brands in two separate transactions totaling approximately $58.4 million. It has now obtained court approval for all five previously announced transactions totaling approximately $860 million.
"The sale of Drake's and the bread brands are the culmination of our efforts to sell the company's major assets," said Hostess chairman and chief executive Gregory F. Rayburn. "All of the company's beloved brands can now live on." He added that the Irving, TX, company will now turn its attention to selling its remaining miscellaneous assets and completing the liquidation.
The court's approval gives the go-ahead for Collegedale, TN-based McKee Foods Corp. to purchase the Drake's snack cake brand, which includes Ring Dings, Yodels, Devil Dogs, Yankee Doodles and Drake's Coffee Cake, for $27.5 million. United States Bakery, based in Portland, OR, can now proceed with its purchase of Hostess's Sweetheart, Eddy's, Standish Farms and Grandma Emilie's bread brands for $30.9 million.
Earlier, the bankruptcy judge had approved the sale of the Hostess and Dolly Madison snack cake businesses, including Twinkies, Ho Hos and Ding Dongs, which will be gobbled up by private-equity groups Apollo Global Management LLC and Metropoulos & Co. for $410 million.
Flowers Foods, based in Thomasville, GA, will buy the majority of Hostess's bread business, including its Wonder brand, for $360 million. Mexico's Grupo Bimbo will purchase Hostess's Beefsteak bread brand for $31.0 million.
The bankrupt baked goods manufacturer has retained Hilco Industrial LLC to market and sell its remaining assets, including property and equipment.