Key facts
- Flowers Foods is exploring the sale of its Tastykake baked goods business.
- Investment bank RBC is advising Flowers Foods on the potential divestiture.
- Tastykake is expected to be valued at approximately $350 million.
- Tastykake generates roughly $400 million in annual sales for Flowers Foods.
Flowers Foods, the packaged food company known for brands like Wonder Bread and Simple Mills, is reportedly looking to sell its Tastykake baked goods business. The company is working with investment bank RBC on the potential divestiture, which sources familiar with the matter suggest could value Tastykake at around $350 million.
Flowers Foods has been strategically expanding its portfolio of higher-growth brands, leading it to consider divesting businesses that no longer align with its long-term strategy. Tastykake, which produces snack cakes, pies, and donuts under brands such as Krimpets and Kandy Kakes, accounts for approximately $400 million of Flowers Foods' total annual sales of about $5.3 billion. Flowers Foods acquired Tastykake in 2011 for $175 million when the brand was publicly traded.
This potential sale occurs amidst a period of significant activity in the baked goods sector. Bain Capital-owned Dessert Holdings is reportedly exploring a sale or IPO valued at over $3 billion. Additionally, private equity firms Platinum Equity and Butterfly recently acquired Rise Baking Company, and J.M. Smucker completed its $5.6 billion acquisition of Hostess Brands in 2023.