Snack cake company Hostess will once again be a publicly traded company, announcing Tuesday it will be sold to Gores Holdings, a special acquisition company run by The Gores Group, nearly four years after the Twinkie manufacturer sought bankruptcy protection.
Majority owners Apollo Global Management, LLC and C. Dean Metropoulos and family will sell off their stake in Hostess, currently valued at approximately $2.3 billion. Goros Holdings is putting up $375 million in cash to acquire the company. An additional $350 million is being supplied by Gores CEO Alec Gores and other investors.
Upon completion of the transaction, majority owners expect to hold an approximately 42 percent combined stake in Gores Holdings.
“I have enjoyed working together with Apollo to build a vibrant and exciting company, and we are pleased to partner with the Gores Holdings team as we move to the next stage of Hostess' growth and expansion,” says Dean Metropoulos. “We look forward to continuing both our strong organic growth through unique innovations and niche, strategic acquisitions, such as our recent acquisition of Superior Baking, which will extend Hostess' consumer reach in the ‘in-store bakery’ market and expand offerings to customers.”
Hostess was acquired by Metropoulos & Company and Apollo Global Management in 2013, after the nearly century-old bakery experienced financial trouble leading to the liquidation of the old Hostess Brands, Inc. The company’s cake business was sold to the investors to create the current Hostess Brands. The Kansas City, MO-based company operates bakeries in Emporia, KS; Columbus, GA; and Indianapolis, IN.
Hostess was founded in 1919 with the introduction of the Hostess CupCake to the American public. In 1930, the company introduced Twinkies. Today, Hostess Brands produces a variety of new and classic treats including Ding Dongs, Ho Hos, Donettes and Fruit Pies, in addition to Twinkies and CupCakes. Hostess had revenues for the twelve months ended May 31, 2016 of approximately $650 million.