Business

Wonder Bread Saved As Flowers Foods Buys Hostess Brands For $360 Million

An open bag of Wonder Bread is seen November 18, 2012 in Washington, DC. Hostess Brands Inc., who make Wonder Bread as well as Twinkies, Ding Dongs, Ho Ho's and other baked goods, plans to go out of business after Chapter 11 bankruptcy restructuring failed. Hostess, which has faced acrimonious labor relations in recent years as well as the slower US economy, said on November 16 it filed a motion in US Bankruptcy Court seeking permission to close its business and sell its assets, including iconic brands that have fed US households for decades. The 82-year-old Irving, Texas-based company, one of the country's largest bakers, could lay off most of the 18,500 people who staff its 33 bakeries, 553 distribution centers and 527 bakery outlets nationwide. AFP PHOTO/Brendan SMIALOWSKI (Photo credit should read BRENDAN SMIALOWSKI/AFP/Getty Images)
An open bag of Wonder Bread is seen November 18, 2012 in Washington, DC. Hostess Brands Inc., who make Wonder Bread as well as Twinkies, Ding Dongs, Ho Ho's and other baked goods, plans to go out of business after Chapter 11 bankruptcy restructuring failed. Hostess, which has faced acrimonious labor relations in recent years as well as the slower US economy, said on November 16 it filed a motion in US Bankruptcy Court seeking permission to close its business and sell its assets, including iconic brands that have fed US households for decades. The 82-year-old Irving, Texas-based company, one of the country's largest bakers, could lay off most of the 18,500 people who staff its 33 bakeries, 553 distribution centers and 527 bakery outlets nationwide. AFP PHOTO/Brendan SMIALOWSKI (Photo credit should read BRENDAN SMIALOWSKI/AFP/Getty Images)

(Reuters) - Flowers Foods Inc is set to buy Hostess bread brands including Wonder bread for $360 million after no other bidder stepped up to make a competing offer, a source familiar with the matter said on Wednesday.

The bankrupt bakery company was set to run an auction on Thursday for the brands, which also include Butternut, Home Pride, Merita and Nature's Pride, but there will be no auction since there were no other bids, the source said.

There will be an auction for the Beefsteak brand, for which Flowers bid $30 million, since Hostess received a higher bid from Mexico's Grupo Bimbo, said the source, who declined to be named as the process is private.

The deal with Flowers is still subject to approval by a bankruptcy court.

Flowers agreed in January to be the "stalking horse" bidder, which set a floor for the bidding and was subject to a court-supervised auction.

Hostess declined to comment. Flowers and Bimbo were not immediately available to comment.

(Reporting by Martinne Geller in New York; editing by Soyoung Kim and Matthew Lewis)

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