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Sunday, November 18, 2012

Mexican company Bimbo may be eyeing Twinkies

According to the Christian Science Monitor, while food producers ConAgra and Flowers Food, the American company behind Nature Valley granola, have expressed interest along with Little Debbie baker McKee Foods, Mexico’s Grupo Bimbo may hold the inside track.

Grupo Bimbo is the world’s largest bread-baking firm, which already owns parts of Sara Lee, Entenmann’s and Thomas English Muffins and previously made what was considered a low-ball offer of $580 million a few years ago, Forbes reports. Now Hostess may only be worth $135 million.

Economists say high sugar prices tied to US trade tariffs were a big reason Hostess was struggling, but a Mexican company could be a lifeline for Twinkies because it would be able to take advantage of access to lower-priced sugar in Mexico.

While Hostess was clearly struggling, analysts believed Grupo Bimbo had an eye on them since the early 2000s because they saw Hostess as a key ingredient for North American expansion with delivery routes that penetrated across the country into convenience stores, gas stations and grocery markets, according to Forbes.

Daniel Servitje Montull runs Grupo Bimbo, which was founded by his family in 1954. His family is worth $4 billion.

Servitje Montull, has already worked magic before, taking on Mexico’s tortilla market and positioning white bread in Latin America.

If Grupo Bimbo pulls off a deal with Hostess for Twinkies, his next challenge will be resurrecting an American favorite.

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