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Last comment by lholmes 1 year, 11 months ago.

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Bacon shortage now Twinkies, what is a person to do when this is my two favorite foods?

Hostess moves to liquidate after crippling strike.

Hostess Brands Inc. says it's going out of business after striking workers across the country crippled its ability to make its Twinkies, Ding Dongs and other snacks.

The company had warned employees that it would file a motion with U.S. Bankruptcy Court Friday seeking permission to shutter its operations and sell its brands if plants hadn't resumed normal operations by a Thursday evening deadline. The deadline passed without a deal.

The closing would mean the loss of about 18,500 jobs.

"I don't know if they thought that was a bluff," CEO Gregory Rayburn said on CNBC Friday. He said the financial impact of the strike makes it "too late" to save the company even if workers have a change of heart. That's because the clients such as retailers decide to stop carrying products when supplies aren't adequate.

Rayburn said he's hopeful that the company will find buyers for its roster of about 30 brands, which include Ho Hos, Dolly Madison, Drake's and Nature's Pride snacks. The company books about $2.5 billion in sales a year.

Hostess, based in Irving, Texas, said its stores will remain open for several days to sell remaining products. Operations at its 33 factories were suspended Friday. The privately held company filed for Chapter 11 protection in January, its second trip through bankruptcy court in less than a decade.

The move comes after thousands of members of the Bakery, Confectionery, Tobacco Workers and Grain Millers International Union went on strike last week after rejecting a contract offer that slashed wages and benefits in September. The bakers union represents about 30 percent of the company's workforce.

Rayburn said the union's leadership had misled members into believing there was a buyer in the wings who would rescue the company. He said the union hadn't returned the company's calls for the past month.

A union representative did not immediately return a call seeking comment.

Hostess had said earlier this week that production at about a dozen of its plants were seriously affected by the strike. Although many workers decided to cross picket lines, the company said it wasn't enough to keep operations at normal levels. Three plants were closed earlier this week.

Hostess had already reached a contract agreement with its largest union, the International Brotherhood of Teamsters. The Teamsters had urged the bakery union this week to hold a secret ballot on whether to continue striking.

Hostess said the company is unprofitable under its current cost structure, in large part because of union wages and pension costs. Rayburn said in a statement on the company website that all employees will eventually lose their jobs, "some sooner than others."

"Unfortunately, because we are in bankruptcy, there are severe limits on the assistance the (company) can offer you at this time," Rayburn wrote.

Hostess, founded in 1930, was fighting battles beyond labor costs. Competition is increasing in the snack space and Americans are increasingly conscious about healthy eating.




Latest Activity: Nov 16, 2012 at 10:44 AM


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sebekm commented on Friday, Nov 16, 2012 at 11:40 AM

As corporations and small businesses from every corner of society lay off workers or simply shut down in response to the effects of a stagnant economy and the implementation of ObamaCare, things will only get worse. Yes - the American people have spoken, and they are going to get what they wanted (or at least what 51% of them wanted).

This is only the beginning.

up2sumptin commented on Friday, Nov 16, 2012 at 12:02 PM

What will Peter Griffin do now?

Iknowyou commented on Friday, Nov 16, 2012 at 13:13 PM

A person opens a business to do one thing: MAKE A PROFIT. Why else would you take the risk? Where does it say that an employer has to provide you with all these perks? If the company is to survive, it has to make all necessary cuts to keep it profitable. Obviously the union members don't understand this concept. If you don't like it, open your OWN business and just see how much it costs to run. I can almost guarantee you most of these individuals have never operated a business or taken a business class in their life. All they know is what the unions tell them: Company profit, Bad! What a bunch of ding-dongs.

Iknowyou commented on Friday, Nov 16, 2012 at 13:19 PM

Even the Teamsters Union urged them not to strike in this economy.

sebekm commented on Friday, Nov 16, 2012 at 14:30 PM

Business - not government - is the engine which runs our economy. All things good (or bad) spring from the strength or weakness of business in this country. Those who rail against the success of business or corporate profits are arguing against their own success.

We should all take a good look at the rest of the world. Take a good look at the "Arab Spring," at the communist/former-communist countries, and all the rest. Truth be told, they all are working toward economies that are like OURS (or at least the way our economy USED to be).

In 2012, we are witnessing the implosion of everything that made this country great. And this implosion is being enabled and facilitated by a 51% who voted for the decline.

Just like children, some people have to learn everything the hard way. But sometimes the harm done in the process is unrepairable. We'll all see (and feel) where things wind up this time.

golfnut31316 commented on Friday, Nov 16, 2012 at 14:31 PM

Here are a couple of articles with connections to Obama care and workers.

http://finance.yahoo.com/news/wal-mar...

http://finance.yahoo.com/news/florida...

sebekm commented on Friday, Nov 16, 2012 at 16:10 PM

Good links, golfy. Here's another, which begs the question:

ARE TWINKIES TOO BIG TO FAIL?

http://www.politico.com/politico44/20...

up2sumptin commented on Friday, Nov 16, 2012 at 21:47 PM

Unless Twinkies can come up with some dough to pad key people's pockets, the answer is no.

lholmes commented on Saturday, Nov 17, 2012 at 21:02 PM

My kids went to 2 supermarkets looking to stock up on Twinkies and they were gone. Poor kids. They asked me to look online and see if I can find some...lol. I'll give it a shot.


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