published Monday, January 28th, 2013

McKee picked as Drake’s cakes bidder

Hostess has picked the Collegedale, Tenn., maker of Little Debbie as the lead bidder to buy its Drake's cakes.

According to a filing in U.S. bankruptcy court, McKee Foods Corp. has offered $27.5 million in cash for the cake brands, which include Devil Dogs, Funny Bones and Yodels, The Associated Press said. The fate of Twinkies and other Hostess cakes are still being negotiated with other bidders.

The "stalking horse" bid by McKee would set the floor for an auction process that lets competitors make better offers. A judge would have to approve the final sale.

McKee Foods makes a variety of snack cakes under the Little Debbie banner that compete with Hostess cakes at a lower price. For example, its Cloud Cakes resemble Twinkies and its Devil Cremes resemble Devil Dogs.

McKee generates about $1.1 billion in sales a year, with its Little Debbie cake division accounting for $800 million of that, according to the company.

about Staff Report...

Get breaking news from the Times Free Press on Twitter at www.twitter.com/timesfreepress or by visiting us on Facebook or Twitter at the right:

Other National Articles

videos »         

photos »         

e-edition »

advertisement
advertisement

Find a Business

400 East 11th St., Chattanooga, TN 37403
General Information (423) 756-6900
Copyright, Permissions, Terms & Conditions, Privacy Policy, Ethics policy - Copyright ©2014, Chattanooga Publishing Company, Inc. All rights reserved.
This document may not be reprinted without the express written permission of Chattanooga Publishing Company, Inc.