US wholesale baker Hostess Brands Inc could soon announce a deal worth around USD400m (EUR296.2m) to divest certain snack cake brands such as Twinkies and Donettes to buyout firms Apollo Global Management LLC and C Dean Metropoulos & Co, two sources told Reuters.
The targeted activities also include the Dolly Madison bread and Hostess cupcakes brands.
The bankrupt company is currently picking stalking horse bidders for its various brands and activities. Previously, it agreed to sell most of its bread business plus the Beefsteak bread brand to Flowers Foods Inc (NYSE:FLO) in two separate transactions for up to USD360m and USD30m.
Furthermore, Hostess entered into an agreement to shed its Drake’s snack cake operation to McKee Foods Corp for USD27.5m as well as its Sweetheart, Eddy’s, Standish Farms and Grandma Emilie’s bread brands and some assets to United States Bakery Inc, also called Franz Family Bakery, for USD28.9m.
Other interested parties could still participate in an auction for these businesses and make better offers. According to the lead banker on the sale, Joshua Scherer of Perella Weinberg Partners, many parties have shown interest in Hostess’ assets, Reuters said.