Daily News: January 31, 2013

Hostess Selects Stalking Horse Bid for Snack Cake Business

Hostess Brands announced that the company has selected affiliates of Apollo Global Management and Metropoulos & Co. as the stalking horse bidder for the majority of the assets of the company’s snack cake business, which includes both Hostess and Dolly Madison branded products, including the iconic Twinkies brand.

Apollo and Metropoulos have agreed to pay $410 million to purchase the brands, 5 bakeries and certain equipment.

“We are pleased to name Apollo and Metropoulos as the stalking horse bidder for these valuable and beloved brands,” said Hostess Brands chairman and CEO Gregory F. Rayburn. “Interest in these iconic brands has been intense and competitive and we expect that to continue through a robust, court-authorized auction process. The ultimate goal will be the same we have had since we began marketing all of our assets – to maximize value for all of the company’s stakeholders and ensure these great products can be enjoyed by their loyal fans for many years to come.”

Hostess Brands requested that the U.S. Bankruptcy Court for the Southern District of New York authorize the company to proceed with an auction for the majority of the assets of the snack cake business on March 13, provided the company receives competing qualified bids. The company will select the highest and best offer at the conclusion of the auction. The sale to the winning bidder requires court approval.

“The stalking horse bids have set a floor of more than $850 million for the bulk of the Company’s assets,” Rayburn said. “We look forward to competitive auctions to further drive value for all of the Company’s stakeholders.”

Jones Day provided legal advice to Hostess Brands on the transaction. Perella Weinberg Partners served as the Company’s financial advisor.

Previously on abfjournal.com:

Metropoulos, Apollo to Bid for Hostess Cakes Business, Wednesday, January 23, 2013