Hostess Brands has reached an agreement to buy Voortman Cookies Ltd., a Canadian company that is the leading processor of crème wafers and sugar-free cookies.
Hostess will pay Swander Pace Capital about $320 million (U.S.) for Voortman, whose earnings are estimated at about $20 million for 2020. It expects annual savings of $15 million in logistics, operations, procurement and other synergies of absorbing Voortman, which will become a wholly owned subsidiary. Hostess expects earnings from the Voortman business to grow to as much as $50 million by 2022. The transaction is scheduled to close early next month.
Voortman’s products include wafers, sugar-free and specialty cookies. Founded in 1951 and based in Burlington, Ont., it was the No. 1 player in crème wafers and sugar free cookies, as reported by Nielsen for the 52-week period ended Nov. 2, 2019, and has achieved compound annual point of sale growth over the last three years of approximately 5%.
“Voortman is a leading brand with a well-defined consumer position that complements and extends the growing Hostess portfolio into the growing cookie and better-for-you sweet snacking categories with meaningful runway for future growth,” Andy Callahan, Hostess’ president and CEO, said in a statement.