Walmart, Kroger Among Bidders for Hostess
A couple of surprise names have popped up in the bidding war for bankrupt Hostess Brands Inc., makers of Twinkies, Ho-Hos, and Wonder Bread. Last Monday was the deadline for bidders to show interest in acquiring the iconic American brands.
According to a report at Bloomberg that cites a "person familiar with the matter," Wal-Mart Stores Inc. (NYSE: WMT) and Kroger Co. (NYSE: KR) are among some two dozen bidders. The bankruptcy sale of Hostess could generate $1 billion for the company's creditors.
Previous speculation had named Flower Foods Inc. (NYSE: FLO), Campbell Soup Co. (NYSE: CPB), and Mexico's Grupo Bimbo as likely bidders. Each already operates bakery operations and could probably tool up to produce the Hostess goodies without having to deal with the bankrupt company's union bakers.
Not all the bidders are seeking all the assets of Hostess according to Bloomberg's source. Some want just the cake or bread business and some are interested only in the company's plants.
Walmart's history with unions casts some doubt on the likelihood of a bid from the world's largest retailer. If Walmart is the eventual acquirer, the form Hostess union bakers will likely be very unhappy. Kroger already has a contract with the United Food and Commercial Workers Union, the group that represents Hostess workers.
Filed under: 24/7 Wall St. Wire, Bankruptcy, Food, Labor & Unions Tagged: CPB, FLO, KR, WMT