Feds OK Flowers Foods Acquisition of Hostess Bread Businesses

THOMASVILLE, Ga.Flowers Foods, Inc., on July 8 received regulatory approval pursuant to the Hart-Scott-Rodino Act to acquire the Wonder, Nature's Pride, Merita, Home Pride, and Butternut bread brands; 20 bakeries; and 36 depots from Old HB, Inc., formerly known as Hostess Brands. Flowers expects to complete the transaction in the coming weeks.

In February 2013, Flowers Foods, Inc., won approval for its $360 million stalking horse bid for the majority of Hostess Brands bread business assets. In March 2013, the court overseeing the Old HB, Inc., bankruptcy proceeding approved the sale.

Hostess Brands Bankruptcy Background

On Nov. 16, 2012, Hostess Brands filed a motion in U.S. Bankruptcy Court to shutter its operations and liquidate its assets as a result of a weeklong strike by members of the Bakery, Confectionery, Tobacco Workers and Grain Millers (BCTGM) International Union.

The Board of Directors authorized the wind down of Hostess Brands to preserve and maximize the value of the estate after one of the companys largest unions, BCTGM, initiated a nationwide strike.

On Nov. 21, 2012, the U.S. Bankruptcy Court for the Southern District of New York approved Hostess Brands emergency interim motion for the orderly wind down of its business and sale of its assets after the company and the Bakery, Confectionary, Tobacco and Grain Millers Union (BCTGM) were unable to reach an agreement during an 11th-hour mediation.

The shuttering of Hostess business operations resulted in the closure of 33 bakeries, 565 distribution centers, approximately 5,500 delivery routes, 570 bakery outlet stores and the loss of 18,500 jobs. Hostess Brands said it would sell its popular brands, including Hostess®, Drakes® and Dolly Madison®, which make iconic cake products such as Twinkies®, CupCakes, Ding Dongs®, Ho Hos®, Sno Balls® and Donettes®. Bread brands to be sold include Wonder®, Natures Pride®, Merita®, Home Pride®, Butternut® and Beefsteak®, among others.