Packaged food company Flowers Foods (FLO.N) is seeking to divest its baked goods business Tastykake, according to people familiar with the matter.
The company, which also owns Simple Mills and Wonder Bread, is working with investment bank RBC (RY.TO) on the process and Tastykake could be valued at around $350 million, the people said, requesting anonymity to discuss a private matter.
RBC declined to comment. Flowers Foods did not immediately respond to comment requests.
Flowers has been expanding its portfolio of higher-growth brands while looking to divest a business that no longer fits its strategy, the people said. Flowers acquired Simple Mills, which makes crackers, bars, and baking mixes marketed as healthier alternatives, for $795 million last year.
Thomasville, Georgia-based Flowers has a roughly $1.5 billion market capitalization and generated around $5.3 billion of sales last year, of which Tastykake accounts for around $400 million, the sources said. Tastykake makes snack cakes, pies, and donuts under the Krimpets, Kandy Kakes and Juniors brands.
Tastykake was a publicly traded company until Flowers bought it in 2011 for $175 million.
The potential sale follows several deals involving baked goods companies. Bain Capital-owned Dessert Holdings has been pursuing a $3 billion-plus sale or initial public offering, Reuters reported in February. In 2024, private equity firms Platinum Equity and Butterfly bought Rise Baking Company for an undisclosed amount, while J.M. Smucker acquired Twinkies maker Hostess Brands for $5.6 billion in 2023.
