Hostess Brands, Inc. has entered into a definitive agreement to sell its Superior Cake Products in-store bakery business to Sara Lee Frozen Bakery for $65 million in cash. The transaction is expected to close during the third quarter, subject to customary closing conditions. Hostess expects to use the net proceeds from the transaction to reinvest in its business and pursue acquisitions.
The Superior business has been in existence for more than a century, producing products that include Éclairs, Madeleines, Brownie Bites, Black and White Cookies and others. In 2016, Hostess acquired Superior for approximately $51 million and grew the business from $33 million of net revenue and $5 million of EBITDA to approximately $43 million of net revenue and $7 million of EBITDA.
Sara Lee Frozen Bakery is a leading maker of frozen bakery and dessert products, headquartered in the Chicago suburb of Oakbrook Terrace with bakeries in Michigan and North Carolina. The company’s premier brands include Sara Lee, Van’s, Chef Pierre and Bistro Collection.
