* Offer for snack cake business could still be topped by
* Apollo and Metropoulos need not assume any liabilities
* Sale requires bankruptcy court approval
(Adds more details, background, quotes)
Jan 30 Hostess Brands Inc said
private equity firms Apollo Global Management LLC and C.
Dean Metropoulos & Co have set a baseline offer of $410 million
to buy the company's snack cake brands including Hostess
Twinkies and Dolly Madison.
The so-called stalking horse bid by the private equity
firms, working together to buy the 82-year-old baker, would
serve as the minimum offer for the business, which could still
be topped by others.
Apollo and Metropoulos have agreed to purchase the brands,
five bakeries and certain equipment.
The agreement does not require Apollo and Metropoulos to
assume any of Hostess Snacks' liabilities or other obligations.
Apollo, founded by banker Leon Black, has previously
invested in consumer companies, including CKE Restaurants and
Claire's Stores Inc.
"We believe the Hostess Snacks brands we agreed to acquire
offer significant potential for renewed growth and expansion
into additional channels of distribution," Andy Jhawar, head of
Apollo's Consumer and Food Retail Industry Group, said in a
Dean Metropoulos, ranked 360 on the Forbes 400 list of
America's wealthiest people, is a packaged foods veteran who was
once the joint owner of brands including Duncan Hines baking
mixes, Vlasic pickles and Swanson frozen dinners.
"We are pleased to be partnered with Apollo as we seek to
resurrect Hostess Snacks and return these legendary products to
the American consumer," C. Dean Metropoulos, Founder and Chief
Executive Officer of Metropoulos & Co. said.
Hostess said late on Wednesday that it would select the
winning bidders for the assets of the bread and snack cake
businesses at the conclusion of various auctions.
The company has requested that the bankruptcy court in New
York authorize it to proceed with an auction for the majority of
the assets of the snack cake business on March 13.
The sale to the winning bidder requires court approval.
Hostess was granted permission by a U.S. bankruptcy court
judge in November to wind down its business and liquidate its
assets after a strike by a baker's union crippled the company's
Hostess Brands has previously reached stalking horse
agreements worth an aggregate purchase price of more than $440
million to sell the majority of the assets related to its bread
business, including Butternut, Home Pride, Merita and Nature's
"The stalking horse bids have set a floor of more than $850
million for the bulk of the company's assets," Hostess Brands
Chief Executive Gregory Rayburn said.
The sale of assets, which range from Twinkies and Wonder
bread to real estate and baking equipment, is being run by
Perella Weinberg Partners.
The case is In re: Hostess Brands Inc et al, U.S. Bankruptcy
Court, Southern District of New York, No. 12-22052.
(Reporting by Sakthi Prasad in Bangalore; Editing by Chris
Gallagher and Daniel Magnowski)