THOMASVILLE, Ga., Oct. 26, 2012 /PRNewswire/ -- Flowers Foods, Inc. (NYSE: FLO) today announced that the United States Department of Justice has approved an agreement under which Flowers will acquire certain assets and trademark licenses from BBU, Inc., a subsidiary of Grupo Bimbo S.A. B. de C.V. The financial terms of the transactions were not disclosed.
Under the terms of the transactions, Flowers will receive perpetual, exclusive, and royalty-free licenses to the Sara Lee and Earthgrains brands for sliced breads, buns, and rolls in the state of California, which together account for annual sales of approximately $134 million. Flowers also will receive perpetual, exclusive, and royalty-free license to the Earthgrains brand for a broad range of fresh bakery products in the Oklahoma City, Okla., market area. The transactions will be completed in phases. The Oklahoma City license will be completed shortly, and the first phase of the California transaction is expected to close in the first quarter of fiscal 2013.
Commenting on the announcement, George E. Deese, Flowers Foods' chairman and CEO, said, "The acquisition strengthens our market presence in California, adding about 14.5 million people to the 70% of the U.S. population that currently has access to our fresh breads and rolls. This moves us closer to our goal of reaching 75% of the U.S. population through our direct-store-delivery system by 2016."
Flowers Foods has proven experience integrating acquisitions. The company has completed more than 100 acquisitions since listing publicly in 1968, including 13 in the past decade. Most recently, Flowers acquired Tasty Baking Company in 2011 and Lepage Bakeries, Inc. in 2012. Management will discuss the acquisition of the Sara Lee assets on its quarterly earnings conference call, which is scheduled for November 8, 2012.
Headquartered in Thomasville, Ga., Flowers Foods, Inc. (NYSE: FLO) is the second-largest producer and marketer of packaged bakery foods for retail and foodservice customers in the United States with 2011 sales of $2.8 billion. Flowers operates 44 bakeries that produce a wide range of bakery products. These products are sold through a direct-store-delivery network with access to approximately 70% of the U.S. population in the East, South, and Southwest as well as in certain markets in California. Select Flowers products are sold nationwide through customers' delivery systems. Among the company's top brands are Nature's Own, Tastykake, and Mrs. Freshley's. For more information, visit www.flowersfoods.com.
Statements contained in this press release that are not historical facts are forward-looking statements. All forward-looking statements are subject to risks and uncertainties that could cause actual results to differ from those projected. Other factors that may cause actual results to differ from the forward-looking statements contained in this release and that may affect the company's prospects in general include, but are not limited to, (a) competitive conditions in the baked foods industry, including promotional and price competition, (b) changes in consumer demand for our products, (c) the success of productivity improvements and new product introductions, (d) a significant reduction in business with any of our major customers including a reduction from adverse developments in any of our customer's business, (e) fluctuations in commodity pricing, (f) our ability to fully integrate recent acquisitions into our business, and (g) our ability to achieve cash flow from capital expenditures and acquisitions and the availability of new acquisitions that build shareholder value. In addition, our results may also be affected by general factors such as economic and business conditions (including the baked foods markets), interest and inflation rates and such other factors as are described in the company's filings with the Securities and Exchange Commission.
SOURCE Flowers Foods, Inc.