Hostess says liquidation decision expected todayPublished: 11/16/12 @ 12:00
Hostess Brands Inc. said it likely wouldn’t make an announcement until this morning on whether it will move to liquidate its business after the company had set a Thursday deadline for striking employees to return to work.
The maker of Twinkies, Ding Dongs and Wonder Bread had warned employees it would file a motion in U.S. Bankruptcy Court to unwind its business and sell off assets if plant operations didn’t return to normal levels by 5 p.m. Thursday. That would result in the loss of about 18,000 jobs.
A spokesman for Hostess, Lance Ignon, said the company likely would make an announcement today after assessing plant operations Thursday evening.
Hostess, based in Irving, Texas, already has reached a contract agreement with its largest union, the International Brotherhood of Teamsters. But thousands of members in its second-biggest union went on strike late last week after rejecting in September a contract offer that cut wages and benefits. Officials for the Bakery, Confectionery, Tobacco Workers and Grain Millers International Union say the company stopped contributing to workers’ pensions last year.
Hostess says that production at about a dozen of the company’s 33 plants has been seriously affected by the strike. Three plants were closed earlier this week.
A representative for the bakery-workers union did not respond to request for comment. The Teamsters meanwhile are urging the smaller union to hold a secret ballot on whether to continue striking. Citing its financial experts who had access to the company’s books, the Teamsters say that Hostess’ warning of liquidation is “not an empty threat or a negotiating tactic” but a certain outcome if workers continue striking.