Let the games begin.
According to Bloomberg Businessweek, Kroger, Wal-Mart, Grupo Bimbo and Alpha Baking Co., are among some 24 companies bidding for assets being sold by Hostess Brands Inc., the bankrupt 82-year-old manufacturer of Twinkies, Ding Dongs, Sno Balls, and Wonder Bread.
In January, 2012 the company filed for bankruptcy, the second time since 2009.
On Nov, 9, more than 5,000 Hostess workers who belonged to the Bakery Confectionery Tobacco Workers and Grain Millers International Union went on strike over concessions demanded by the company. After failing to reach an agreement with the union, Hostess announced plans to liquidate its assets and fire more than 18,000 workers.
Among the challenges Hostess faced, including changes in American diets and high labor costs, were high sugar tariffs meant to protect local producers. Grupo Bimbo, the largest bread-baking company in the world, is also reportedly among the bidders. It is headed by Mexican billionaire Daniel Servitje Montull, and could be in a good position to take advantage of lower sugar prices in Mexico, ABC News reported.
Food producers ConAgra and Flowers Food, the Atlanta-based company behind Nature Valley granola, also expressed interest in Hostess. So did McKee Foods, the baker of Little Debbie snacks. Through a spokesperson, Daren Metropoulos, a principal at C. Dean Metropoulos & Co., a private-equity firm in Greenwich, Conn. that owns Pabst Brewing Co., told ABC News that the company was “very interested in the Hostess brands. We submitted our proposal this week and plan to fully participate in the process.”
While some speculate that bidding for Hostess’ assets could go as high as $1 billion, Erin Lash, a senior Equity Analyst at Morningstar, told ABC News that she is unsure. While the snacks segment is one of the faster-growing categories in packaged food, ”the ultimate price depends on whether the brands are sold in whole or in part,” she said.
Hostess declined to comment to ABC News, as did representatives for Alpha Baking, Grupo Bimbo, Wal-Mart and Kroger.
“We do not comment on rumors or speculation,” Kroger spokesperson Keith Dailey told ABC News.