CHATTANOOGA, Tenn. — McKee Foods, makers of Little Debbie snack cakes, is offering $25 to $30 million for Hostess Brands' Drake's brand, according to published reports. Hostess filed for Chapter 11 bankruptcy protection in January 2012.
The Tennessee maker of Little Debbie snack cakes is poised to be the lead bidder at an auction for the assets of the bankrupt company, composed mostly of intellectual property and some equipment, according to the reports. Drake's Wayne, N.J., plant — the only kosher bakery plant in the U.S., a Hostess investment banker has said in court — isn't included in the deal.
Drake brands is the maker of such treats as Devil Dogs, Ring Dings and Yodels.
Hostess is aiming to file the agreement with the U.S. Bankruptcy Court in White Plains, N.Y., on Monday. The deal requires a judge's approval to be put into action, and the offer will be subject to higher bids at auction.