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Hostess, maker of Twinkies, to go out of business; strike cited



Published: Fri, November 16, 2012 @ 2:30 p.m.

Hostess, maker of Twinkies, to go out of business; strike cited

NEW YORK - Twinkies may last forever, but the same can’t be said for the company that makes the cream-filled sponge cake. Hostess Brands Inc., the company that makes Twinkies and Wonder Bread, has asked a judge for permission to go out of business and lay off 18,500.

The company is blaming its decision to shut down on a labor strike by members of the Bakery, Confectionary, Tobacco Workers and Grain Millers International Union, but Americans’ appetite for junk food has been waning in recent years. The company has filed for bankruptcy twice this decade, the last time in January.

“We deeply regret the necessity of today’s decision, but we do not have the financial resources to weather an extended nationwide strike,” Gregory F. Rayburn, Hostess’ chief executive, said in a statement.

Many businesses have faced labor unrest in the recovery from the recession as they try to dial back benefits and wages and unions resist. In 2011, for example, there were 19 major strikes and lockouts involving more than 1,000 workers, according to the Bureau of Labor Statistics, up from 11 in 2010. The 2011 strikes accounted for 1.02 million lost workdays.

The union said in a statement that Hostess made unreasonable demands, including wage and benefit cuts of around 30 percent for workers, while top executives of the company received large pay increases.

Hostess, based in Irving, Texas, has 565 distribution centers around the country, as well as 33 bakeries and 570 bakery outlets. The union says 24 production facilities are currently on strike.

It said it had filed a motion with U.S. Bankruptcy Judge Robert Drain in White Plains, N.Y., for permission to shut down and sell assets.

The company’s brands include Twinkies, Drake’s and Nature’s Pride. It also makes Wonder bread, which was America’s first sliced bread, according to the company’s website.

It plans to sell its assets to the highest bidders.


Comments

1Bozz(11 comments)posted 1 year, 11 months ago

God bless the unions and all the benefit they provide society! I'm sure those 18,000 workers will easily find work with all the job openings out there. Heck, they may not even need to file for unemployment benefits!

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2busyman(239 comments)posted 1 year, 11 months ago

In a Twink of an eye their jobs were gone. I guess those bakers had so much dough, that they haven't seen what has happen to their union brothers in the auto industry and other unions shops were concessions were made to keep good paying jobs. How long does someting have to be closed before I new owner starts to make those Twinkies? Now those twinkies and other cup cakes will come with fortunes inside. Another union that let jobs disappear because of the strength in numbers.

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3Ytownnative(1048 comments)posted 1 year, 11 months ago

Sounds like a good union to me

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4redeye1(4564 comments)posted 1 year, 11 months ago

I just heard that the union is blaming MItt Romney for this closure. They are the typical D party group who looks to blame others for what they did. Just like their great leader BO does. Maybe the union should look in the mirror at themselves first . But the union leaders told their flock of sheep to strike. But I'm betting that the union leaders haven't lost their jobs. What a shame!

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5Freeatlast(1991 comments)posted 1 year, 11 months ago

They where going out no matter what the union did . But it give fodder to the tea types. What a bunch of hate mongers .

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6eagleye(59 comments)posted 1 year, 11 months ago

So, 4 or 5,000 union schmucks can thrown a tantrum and not take some cuts, and put the company out of business and kill not only their jobs, but the jobs of their fellow 13,000 employees too. Greed? How's that union working for them? Now they will all get unemployment benefits for God know how long, tap into the Obamunist freebie train and become must some more maggots courtesy of the union sucking some more blood out of the remaining 52% of the taxpayers who are still working and carrying the parasites.

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7peacelover(790 comments)posted 1 year, 11 months ago

How would you feel if the top echelon received large pay raises and you were asked to take a big pay cut? talk about greed.

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8ytownredux(117 comments)posted 1 year, 11 months ago

The company has filed for bankruptcy twice, with no unions to blame then. But if you look it up, even after a January 2012 bankruptcy the mgmt got raises. I am sure Mitt Romney is on that Board somewhere. But let's blame it on the unions instead of plain old bad management. Gotta give the TParty something to complain about since they lost the election. Oh wait, they complain about EVERYTHING.

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9NoBS(1963 comments)posted 1 year, 11 months ago

I see all the union haters are jumping on this one. They're probably angry because their favorite junk food is going away.

The REAL story is that CEO-level management gave themselves huge raises. The CEO got himself a 300% raise!! Yes, 300%. Don't believe me? Read it and weep, haters: http://www.huffingtonpost.com/2012/11... Then Hostess gave the rank and file an ultimatum: "Take at least a 30% wage cut, or we'll declare bankruptcy and get rid of all of you!" Well, the union workers had had enough, and held their ground. THAT's why Hostess is going bankrupt. Management's fault, all the way.

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10Lifes2Short(3877 comments)posted 1 year, 11 months ago

Funny how everyone knows everything about the inner workings of a Company. Whatever media you follow, it's their word and their followers just accept it. Might as well wait for the book to come out from the CEO's and the Union leaders. I'm sure there will be different stories.

Oh, how I'm going to miss the ZINGERS. Loved them!

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11IslandMike(757 comments)posted 1 year, 11 months ago

Working for a non-living wage is not worth working.

CONGRATS to the 18,000 who had the COURAGE to say ENOUGH. This company would have liquidated no matter what happened. They'll make sure the executives walk away with 7 figure severance packages. The general public for the most part feels they're entitled.

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12AnotherAverageCitizen(1175 comments)posted 1 year, 11 months ago

The company has had problems for years. And now you only want to blame the union for the COMPANIES FAILURE.

Eagleeye, If the union took a pay cut, do you really think that would have SAVED this company? There are many NONUNION companies that have folded, too bad you could not blame the unions for those also.

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13chuck_carney(499 comments)posted 1 year, 11 months ago

GM is alive and Hostess is in the same "grave"situation as Bin Laden.

Obama-ites continue to drive the wedge between capital and labor. like log splitting. Neither will survive in this country without the other. However, capital can move more easily. And more workers will lose their jobs

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14thinkthentalk(265 comments)posted 1 year, 11 months ago

Chuck, go get yourself a free papajohn pizza to ease your pain.

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15chuck_carney(499 comments)posted 1 year, 11 months ago

Dear Don't Thinkthantalk, I don't have any pain, but the 18,000 mloyees and their families will feel the pain this Christmas and beyond.

The unions caused great inefficiency at Hostess. The same route driver was unable to deliver both Wonder bread and twinkies. Two separate drivers were required increasing labor and transportation costs. Just think hoe much money would have been saved on gasoline and less pollution to boot.

Plus, those jobs will probably move ouside the US.

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