Out of Business Twinkie Maker Hostess to Shut Down Operations

Striking employees have forced Hostess Brands, maker of Twinkies and other delicious lard-filled goodies, to shut down and liquidate, ABC News reports:

Hostess"We deeply regret the necessity of today's decision, but we do not have the financial resources to weather an extended nationwide strike," said Gregory F. Rayburn, chief executive officer. "Hostess Brands will move promptly to lay off most of its 18,500-member workforce and focus on selling its assets to the highest bidders."

Hostess said it will seek bankruptcy court permission to close its business and sell its assets, "including its iconic brands and facilities. Bakery operations have been suspended at all plants."

Is it the end of the Twinkie, the Ding Dong, and the Ho-Ho?

Hostess will move to sell its assets to the highest bidder. That could mean new life for some of its most popular products, which could be scooped up at auction and attached to products from other companies.

A letter that Hostess sent to its network of stores that carry its product said it expects "there will be great interest in our brands." But it said it could not give a time frame for when the sales would take place and its products would be available again.

But even if those brands are bought and restarted, the Hostess workers will not get their jobs back.

Get your last Twinkies now!

Comments

  1. Caliban says

    I suspect this is more about union busting than anything else, post-election CEO hardball. “If I can’t have EVERYTHING I want (in this case living like 18th century royalty while paying a pittance to the workers) I’m taking my toys and going home.”

    Twinkies aren’t going anywhere, though since they’re nothing but spun sugar and preservatives it would be no great loss if they disappeared off the face of the Earth. But the brands and facilities will likely be sold off (it’ll be interesting to see who ends with them) and they’ll be pooping the same nasty cr*p out while paying lower wages to the people who actually produce this alleged “food.”

  2. Eric says

    “Striking employees have forced Hostess Brands”

    Um, no. Hostess asked workers to take cuts of around 30% in wages and benefits while top executives received large pay increases, and Hostess was so badly managed that they filed for bankruptcy twice in the last ten years.

    More info, from the union’s side, in a statement issued a few days ago:

    The following statement was issued by BCTGM International Union President Frank Hurt in response to claims by Hostess Brands that it would begin liquidation should union members not end the strike and return immediately to production facilities:

    “The crisis facing Hostess Brands is the result of nearly a decade of financial and operational mismanagement that resulted in two bankruptcies, mountains of debt, declining sales and lost market share. The Wall Street investors who took over the company after the last bankruptcy attempted to resolve the mess by attacking the company’s most valuable asset – its workers.

    “They sought to force the workers, who had already taken significant wage and benefit cuts, to absorb even greater cuts including the loss of their pension contributions. I have said consistently throughout this process that the BCTGM is a highly democratic organization and that our Hostess members themselves would determine their future. By an overwhelming majority, 92 percent, these workers rejected the company’s outrageous proposal, fully aware of the potential consequences.

    “Our members know that the plans all along of the Wall Street investors currently in control of this company did not include the operation of Hostess Brands any longer than it takes to sell the company in whole – or in part – in a way that will maximize the profits of these vulture capitalists regardless of the impact on the workforce.

    “The wholesale bread and cake baking business is unique. The most successful and profitable wholesale baking companies share common attributes, most notably being executive leadership with extensive background in the business and a skilled and dedicated workforce. Hostess Brands and its predecessor companies have had the latter for decades.

    “Unfortunately however, for the past eight years management of the company has been in the hands of Wall Street investors, “restructuring experts”, third-tier managers from other non-baking food companies and currently a “liquidation specialist”. Six CEO’s in eight years, none of whom with any bread and cake baking industry experience, was the prescription for failure.

    “Despite Greg Rayburn’s insulting and disingenuous statements of the last several months, the truth is that Hostess workers and their Union have absolutely no responsibility for the failure of this company. That responsibility rests squarely on the shoulders of the company’s decision makers.

    http://bctgm.org/2012/11/hostess-in-current-condition-because-of-failed-management/

  3. unruly says

    What Eric said. This is not the first time they’ve filed for bankruptcy. They’ve already shuttered plants in this past year. The whole company is mismanaged and now they’re blaming it on unions.

  4. anon says

    If they were mismanaged then it follows they’d go out of business. Either way, the employees suffer the most. According to the union, had they taken the deal, the company would still have gone out of business. What was the union thinking then? How was the strike going to help the members? My guess is that competition from Walmart and Costco brands were making life too difficult for them.

  5. Icebloo says

    This is SUCH bs. They just want people to think striking will cost you your job. It’s all just a threat to their workers to take away their legal right to strike. These horrible people would have us all working from 7 until the day we die if the could. Corrupt, corrupt, corrupt !

    I am glad I have never bought any of their crappy products and I am glad they are going out of business.

  6. G McGinnis says

    Screw the twinkies. Could this be the end of Devil Dog’s? When I went to NY a couple of years ago I notices the little hostess logo on the Drake’s Cakes. I assume Hostess bought them out so Devil Dogs, Yodels, and Yankee Doodles may be on the way out as well and that is a real tragedy.

  7. Tom in long beach says

    I call BS, the venture capitalists will make a ton of money selling off the company.
    Of coarse lots of Republicans are getting hard ons with the idea of just firing people instead of dealing fairly with organized labor. “people should be happy just to have a job”. translation “take a pay cut because out CEOs who do not know how to run a company deserve bigger bonuses”.
    It is also possible that while we all have fond memories of these “favorites” not too many people are actually buying them?

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