Q: Hostess Brands- CLOSED DOWN

newjerseychickxo
172
http://hostessbrands.com/Closed.aspx

Hostess Brands is Closed. We are sorry to announce that Hostess Brands, Inc. has been forced by a Bakers Union strike to shut down all operations and sell all company assets. For more information, go to . Thank you for all of your loyalty and support over the years.

HOSTESS BRANDS TO WIND DOWN COMPANY AFTER BCTGM UNION STRIKE CRIPPLES OPERATIONS

Friday, November 16, 2012 at 7:00AM Irving, TX – November 16, 2012 – Hostess Brands Inc. today announced that it is winding down operations and has filed a motion with the U.S. Bankruptcy Court seeking permission to close its business and sell its assets, including its iconic brands and facilities. Bakery operations have been suspended at all plants. Delivery of products will continue and Hostess Brands retail stores will remain open for several days in order to sell already-baked products. The Board of Directors authorized the wind down of Hostess Brands to preserve and maximize the value of the estate after one of the Company’s largest unions, the Bakery, Confectionery, Tobacco Workers and Grain Millers International Union (BCTGM), initiated a nationwide strike that crippled the Company’s ability to produce and deliver products at multiple facilities. On Nov. 12, Hostess Brands permanently closed three plants as a result of the work stoppage. On Nov. 14, the Company announced it would be forced to liquidate if sufficient employees did not return to work to restore normal operations by 5 p.m., EST p.m., Nov. 15. The Company determined on the night of Nov. 15 that an insufficient number of employees had returned to work to enable the restoration of normal operations. The BCTGM in September rejected a last, best and final offer from Hostess Brands designed to lower costs so that the Company could attract new financing and emerge from Chapter 11. Hostess Brands then received Court authority on Oct. 3 to unilaterally impose changes to the BCTGM’s collective bargaining agreements. Hostess Brands is unprofitable under its current cost structure, much of which is determined by union wages and pension costs. The offer to the BCTGM included wage, benefit and work rule concessions but also gave Hostess Brands’ 12 unions a 25 percent ownership stake in the company, representation on its Board of Directors and $100 million in reorganized Hostess Brands’ debt. “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.” In addition to dozens of baking and distribution facilities around the country, Hostess Brands will sell its popular brands, including Hostess®, Drakes® and Dolly Madison®, which make iconic cake products such as Twinkies®, CupCakes, Ding Dongs®, Ho Ho’s®, Sno Balls® and Donettes®. Bread brands to be sold include Wonder®, Nature’s Pride ®, Merita®, Home Pride®, Butternut®, and Beefsteak®, among others. The wind down means the closure of 33 bakeries, 565 distribution centers, approximately 5,500 delivery routes and 570 bakery outlet stores throughout the United States. The Company said its debtor-in-possession lenders have agreed to allow the Company to continue to have access to the $75 million financing facility put in place at the start of the bankruptcy cases to fund the sale and wind down process, subject to U.S. Bankruptcy Court approval. The Company’s motion asks the Court for authority to continue to pay employees whose services are required during the wind-down period. For employees whose jobs will be eliminated, additional information can be found at . The website also contains information for customers and vendors. Most employees who lose their jobs should be eligible for government-provided unemployment benefits.

newjerseychickxo posted Nov 18, 2012
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15 Comments
VirginiaPeanuts
Bummer :-(. Hopefully whoever buys it will keep the products around. Little Debbie is cheaper and seemed to be more available at my stores. Whitewheat (owned by nature's own) also seemed to be on sale more often than wonder bread. Nowadays, people are gonna go for the cheaper items. Its a shame so many people will have to be on unemployment and without a job.
VirginiaPeanuts (rep: 11.3k) posted Nov 18, 2012
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rd995
so the union strike force them to shut down now they will reopen with a different name or supposedly sell the company to get rid of the union and come back stronger i don't blame them sometimes unions are just greedy
rd995 (rep: 105k) posted Nov 18, 2012
41
krmills1
Hopefully little debbie will buy them out and we can still get our hands on those yummy twinkies once again.
krmills1 (rep: 14.2k) posted Nov 18, 2012
20
faehinby
The news is very important, if you choose something new it
How about it?
faehinby (rep: -13) posted Nov 18, 2012
00
kimeeb
Isn't that kinda shooting yourself in the foot. Now they are all out of jobs. HMMM
kimeeb (rep: 71.4k) posted Nov 19, 2012
10
nthsll
Unions have outlived their usefulness, and are a big part of the reason jobs are outsourced to cheaper labor markets.
nthsll (rep: 12.4k) posted Nov 19, 2012
33
lancescape
A sad day for Diabetes, but we Americans are resourceful and will find other ways to ramp up our obesity rates. USA! USA!
lancescape (rep: 145) posted Nov 19, 2012
12
catchersmom
Bimbo bakery is slated to buy Hostess and man do they make a lot of what we eat already

http://www.bimbobakeriesusa.com/
catchersmom (rep: 19.7k) posted Nov 19, 2012
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catchersmom
By Adrian Carrasquillo, NBC Latino
Next week may be Black Friday but sweets lovers across the nation hung their heads in sorrow on a dark Friday yesterday as Hostess announced they would cease making their line of products, which include the iconic Twinkies brand, because of the Bakers Union Strike.

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But now as the brand heads towards liquidating and selling off their assets, a Mexican company may be angling to resurrect the golden Twinkies.
Read the original story at NBC Latino
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.
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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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Michael Moore's "If Only I Were Mexican" Twitter hashtag pokes at Romney, backfires
New York Fashion Week: Adolfo Sanchez brings the drama to high-end fashion
catchersmom (rep: 19.7k) posted Nov 19, 2012
00
maven3
Looks like Hostess is saved for now:
http://www.washingtonpost.com/business/hostess-saved-for-now-by-court-order/2012/11/19/e062bc19-79ef-4a4f-8266-9817d15ba3f5_video.html

Everybody can keep buying twinkies.
maven3 (rep: 5.23k) posted Nov 19, 2012
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lancescape
Fatties rejoice!
lancescape (rep: 145) posted Nov 19, 2012
11
munkin2u
^You're not being nice.
munkin2u (rep: 1.26k) posted Nov 20, 2012
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dealwagger
The sad part is that the Baker's Union is not the only one that was in play; the Teamsters had agreed to the concessions. So because of the other union, they are now suffering. :(
dealwagger (rep: 10.2k) posted Nov 20, 2012
10
bbattag
@catchersmom - It's too early to say Bimbo will buy them. Everything will go to the highest bidder.
bbattag (rep: 6.75k) posted Nov 21, 2012
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bbattag
@dealwagger is right. Greed by a union of 5,000 people has resulted in the loss of 18,000 jobs.

If the deal was that bad, the other union would not have accepted it early on. If Hostess had tons of money, they wouldn't be in this situation. When your company is close to going bankrupt, you have to either take concessions or go find another job.
bbattag (rep: 6.75k) posted Nov 21, 2012
10