Grupo Bimbo Cannot Buy Hostess Brands, Says Hostess CEO
Nov 19, 2012 | 2:11 PM
Nov. 19, 2012 - It's been less than a week since Hostess Brands shut down all operations in the wake of a bitter week-long labor strike by its bakers union. In the days Nov. 16, when Hostess announced it would shut down and stop producing Twinkies, Ho-Hos and other iconic treats, there has been much speculation about possible buyers. Will another company snatch up Hostess, which is filing for federal bankruptcy protection, and resurrect Ding Dongs? There have been a few names dropped, but most speculation seems to have centered on Grupo Bimbo, a $10 billion dollar Mexican company. Those speculations are wrong.
It is very likely that Hostess will be purchased, but it won't be Bimbo. In fact, says the CEO of Hostess, it's just not possible because it would violate federal anti-trust laws. Bizjournals.com reports the following today:
Hostess Brands' CEO Greg Rayburn said Monday it's not possible for Grupo Bimbo SAB to buy the bankrupt Irving-based bakery company.... Rayburn said Bimbo was required by the U.S. Justice Department to sell some Sara Lee brands in order to complete its purchase of Sara Lee's North American bakery operations, Bloomberg said.“Due to antitrust, it would never happen,” Rayburn said on Bloomberg. Full story at bizjournals.com....
This is unfortunate, of course, because it means that we will never see "Bimbo Hostess" on the box of any snack cakes.
Rayburn says Hostess will "draw strategic buyers" and private-equity investors for its brands. He did not name any specific companies that might buy Hostess, in whole or piecemeal. Bloomberg.com reports that Rayburn says Hostess is "more attractive" to buyers without the unions and that "There will be a number of people interested." (See an interview with Greg Rayburn in the video below.)