NEW YORK CITY -- Hostess Brands Inc. has received court permission to hire Hilco help sell off real estate and other assets. Federal Judge Robert Drain of the U.S. Bankruptcy Court for the Southern District of New York said on Jan. 8 that Hilco Trading Co. LLC, a Northbrook, IL-based liquidator, can act as the agent for Hostess.
Hostess ceased production of its pasty and bakery brands, including Twinkies, Ho Hos and Wonderbread, last year after it failed to reach agreements with its unions, and filed for Chapter 11 bankruptcy. It was the second filing by the firm in less than 10 years. | SEE STORY
Hilco's branches will work together to perform the liquidation. They include Hilco Real Estate LLC, Hilco Industrial LLC and Hilco Streambank, along with Hilco Asset Protection LLC, which will offer security protection to Hostess bakeries until the company is sold.
After court-supervised auctions are held by investment bank Perella Weinberg Partners, Hilco will sell the remaining real estate, machinery and equipment. Hilco will also assist Perella Weinberg in the sale of any remaining intellectual property.
Hostess said in December that it was narrowing down the bids it had received and that it expects to sell off its snack cakes and bread brands to different buyers. Once it files binding bids, a four-week auction process will allow competing bids. Closings for many brands could come as soon as mid-March.
The Wall Street Journal reported that Hostess Brands Inc. could reveal as early as next week that Flowers Foods Inc. (Thomasville, GA) and Mexico's Grupo Bimbo SAB are in discussions to acquire its bread brands, which could command $350 million. Grupo Bimbo's brands include Arnold breads, Thomas' English muffins and Entenmann's cakes. Flowers Foods Inc.'s portfolio includes Mrs. Freshley's and Tastycake pastries and Nature's Own breads.