Hostess, the maker of Twinkies, Ding Dongs and Wonder Bread, is going out of business
11/16/2012
Hostess, the maker of Twinkies and Wonder Bread, plans to go out of business, lay off its 18,500 workers, including at its Northwood plant, and sell its snack cake and bread brands.
THE BLADE/LISA DUTTON
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IRVING, Texas — 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, Wonder Bread and other snacks.
Albert Garcia, a Hostess employee for over 14 years, talks about losing his job on Friday monring. He was striking outside the plant when he learned that Hostess was closing it's doors.
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 assets if plants didn't resume normal operations by a Thursday evening deadline.
The closing would mean the loss of about 18,500 jobs.
The company's Northwood plant employed 184 people in August, according to city tax records. Hostess also has a bakery in Defiance, and outlet stores in Toledo and Northwood.
Photo gallery: Hostess plant in Northwood shutters operations
The Bakery, Confectionery, Tobacco Workers, and Grain Millers International Union Local 19 represented about 110 of those employees, union officials said.
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Today, a half dozen Local 19 members stood outside the plant, continuing their strike and waiting for official word on the plant's status.
One member said an executive secretary at the plant had come to the picket line and told them the company was liquidating, but they said they had not heard from the plant manager or any other Hostess officials.
Still, the tone was not optimistic.
"We've all been here 13, 11, 14 years," said Jeff Hall, an 11-year employee. "We've been here a heck of a long time and they're doing this to us."
The parking lot near the plant's main entrance was full of cars, but it wasn't clear what, if any, production was being done Friday.
The person working at the front desk inside the facility said the plant manager was not available to comment and referred questions to the company's communication department in Texas.
Hostess, the maker of Twinkies and Wonder Bread, plans to go out of business, lay off its 18,500 workers, including at its Northwood plant, and sell its snack cake and bread brands.
She did not know if the plant was baking bread Friday and said she hadn't been told anything about the future of the company or her job.
“Many people have worked incredibly long and hard to keep this from happening, but now Hostess Brands has no other alternative than to begin the process of winding down and preparing for the sale of our iconic brands,” CEO Gregory Rayburn said in a letter to employees posted on the company website.
He added 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, based in Irving, Texas, suspended bakery operations at its 33 factories and said its stores will remain open for several days to sell already packaged products. The privately held company filed for Chapter 11 protection in January, its second trip through bankruptcy court in less than a decade.
Thousands of members of the Bakery, Confectionery, Tobacco Workers and Grain Millers International Union went on strike last week after rejecting in September a contract offer that slashed wages and benefits. Hostess said Friday the company is unprofitable “under its current cost structure, much of which is determined by union wages and pension costs.”
A union representative did not immediately return a call from The Associated Press seeking comment on the company's announcement.
Hostess had said that production at about a dozen of its plants were seriously affected by the strike. Three plants were closed earlier this week.
The company 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, founded in 1930, was fighting battles beyond labor costs. Competition is increasing in the snack space and Americans are increasingly conscious about healthy eating. Hostess also makes Dolly Madison, Drake's and Nature's Pride snacks.