R.I.P. Hostess: The Irving-Based Company to Shutter Operations
So long Twinkie, Sno-Ball, Ho Ho cake.
According to a statement released this morning at Hostessstrike.info, the Irving-based maker of the iconic Twinkies, Ding Dongs, Ho Ho's and Sno Balls has filed a motion with the U.S. Bankruptcy Courts and will wind down all operations then soon have a giant fire sale.
Among items up for bid: dozens of baking and distribution facilites around the country, including all of the major brands related to Hostess, like Drakes and Dolly Madison.
In total, 18,500 union workers at 33 bakeries and 565 distribution centers are now out of work. This includes over 5,500 delivery routes and 570 bakery outlet stores.
This is Hostess' second tango with bankruptcy court, after it restructured in 2009. This past September, one of its major Teamster unions accepted a new contract with reduced wages and benefits, but their bakers' union rejected the deal that asked for an 8% cut in salaries and also a reduction in pension obligations and health care benefits. According to CNN Money, in exchange the company offered concessions, including a 25% equity stake for workers and the inclusion of union representatives on the board of directors.
Their official strike began last Friday at a plant in Kansas, then spread to other facilities around the country.
Gregory F. Rayburn, chief executive officer of Hostess Brands released a statement this morning: "We deeply regret the necessity of today's decision, but we do not have the financial resources to weather an extended nationwide strike."
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