Hostess Brands Inc. agreed to sell many of its bread brands – including Wonder and Nature's Pride – to rival bakery business Flowers Foods as the liquidating company prepares to shut itself down.
Flowers, which owns the Tastykake and Nature's Own brands, will pay $390 million total for a chunk of Hostess' assets.
Flowers, of Thomasville, Ga., will spend $360 million for the Wonder, Nature's Pride, Butternut, Home Pride and Merita labels as well as 20 Hostess bakeries and 38 depots.
Hostess, based in Irving, Texas, will sell Flowers its Beefsteak bread brand separately in a $30-million arrangement.
In November, a federal bankruptcy judge gave Hostess the go-ahead for an "orderly wind-down" after the company declared bankruptcy and clashed with its striking baker's union.
The 82-year-old pastry maker will trim much of its 18,500 employee headcount while trying to rid itself of snack brands such as Twinkies and Ding Dongs.
For now, Flowers will serve as the so-called stalking horse bidder for Hostess' bread brands, which means it may still have to compete against other offers. The final deal must be approved in bankruptcy court and clear any regulatory hurdles.