Wednesday, February 10, 2016

Who will take over Wonder Bread, Twinkies?

Junk food rummage sale: Will Bimbo, J&J Snack, Tastkake's Flowers bid for brands?

Who will take over Wonder Bread, Twinkies?


After a decade of bankruptcies and fights with its Teamster drivers and Bakery, Tobacco and Confectionery plant workers, the current bosses at Hostess Brands say they are shutting down their bakery in Northeast Philadelphia, laying off 300 workers; closing distribution centers in King of Prussia, Wilmington, and South Jersey; laying off 18,500 in closing all bakeries and warehouses nationwide; and seeking a bankruptcy liquidation sale.

Who are the likely buyers of Twinkies, Hostess cupcakes, Drake's Cakes, Wonder Bread, Ring Dings, and dozens more iconic fatty snack brands?

Sales of many of these products have been slipping for years; in their efforts to shore up profits, Hostess and predecessor Interstate Bakeries have been unable to convince union workers to give up pensions and other pay and benefits. 

So the creditors want someone else to try. "They'll sell to the highest bidder," suggests Robert Costello, boss of $55 million asset Costello Asset Management in Huntingdon Valley, and a former stock analyst who covered Tastykake and other foodmakers.

The many possible buyers of one or more Hostess brands include three big Philadelphia-area employers:

-  Horsham-based, Mexican-owned Bimbo Bakeries USA, owner of Arnold's, Thomas' English Muffins, Stroehmann's, Entenmann's and dozens more brands -- though Bimbo is already so big another acquisition could face antitrust protests;

- Georgia-based Flowers Foods, which owns Tastykake and is expanding production of its own sliced sandwich bread lines at its Oxford, Chester County bakery;

- J&J Snack Foods, the Pennsauken-based owner of dozens of frozen, cafeteria and packaged snacks lines, and a major supplier to Wawa and other retailers.

Maybe buyout firms and other private equity financiers will compete with bakeries to bid for some of the brands, notes Stephanie McAlaine, of the Philadelphia chapter of the Association for Corporate Growth.

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About this blog

PhillyDeals posts interviews, drafts and updates that Joseph N. DiStefano writes alongside his Sunday and Monday columns and ongoing articles about Philadelphia-area business.

DiStefano studied economics, history and a little engineering at Penn. He taught writing and research at St. Joe’s. He has written for the Inquirer since 1989, except when he left a few times to work at Bloomberg and elsewhere. He wrote the book Comcasted, and raised six kids with his wife, who is a saint.

Reach Joseph N. at, 215.854.5194, @PhillyJoeD. Read his blog posts at and his Inquirer columns at Bloomberg posts his items at NH BLG_PHILLYDEAL.

Reach Joseph N. at or 215 854 5194.

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