K - Hostess Sticks Its Hand in the Sugar-Free Cookie Jar
Long known for Twinkies and other sweet, sugar-laden treats, Hostess Brands, Inc. (NASDAQ: TWNK) recently bought Voortman Cookies Ltd., adding a range of sugar-free cookies and creme wafers to its product lineup. Experienced mostly in making and marketing indulgent junk food, the company expands outside its regular bailiwick with this foray into healthier snacking. In doing so, it added a hefty chunk of debt to its balance sheet, but may be on track to toothsome profits from its new acquisition regardless.
Hostess Brands today is a freshly minted company, revived in 2013 from brands salvaged out of the old Hostess Brands' bankruptcy. A private equity firm, Apollo Global Management, allied with billionaire C. Dean Metropoulos, purchased Hostess and several other key brands during the old company's liquidation. The new owners reforged these brands into an enterprise bearing the iconic Hostess name but attempting to follow an energetic new strategy.
On being named President and CEO in 2014, William Toler outlined Hostess' intended growth strategy: appeal to nostalgia with HoHos, Ding Dongs, CupCakes, and, of course, Twinkies, while acquiring new brands to steadily increase the breadth of Hostess' presence in the market. The company purchased Superior Cake Products in 2016, expanding to fresh in-store baked goods. In 2018, it moved into breakfast foods, including Danish pastries, by acquiring Cloverhill and Big Texas.