Hostess Bankrupt

Hostess Brands, the maker of iconic snacks such as Twinkies and Ding Dongs, said Friday it is closing its plants and letting go some 18,000 workers as it moves toward liquidation following a strike by some of its workers.

In an announcement posted on its Web site, the company said it was “sorry to announce that Hostess Brands, Inc. has been forced by a Bakers Union strike to shut down all operations and sell all company assets.” CEO Gregory F. Rayburn said in the statement that “we deeply regret the necessity of today’s decision, but we do not have the financial resources to weather an extended nationwide strike.” Maybe the gap in trust between management and the union had simply grown too wide. Or more likely, the union workers kept at the strike because the last time the company had threatened liquidation, it didn’t follow through.

Whatever were the reasons for the “exquisite game of chicken,” as a fascinating and in-depth Fortune story called the labor disputes, the end result is sad. Eighteen-thousand people are out of a job. The company’s private equity owner may not get anything back.  And while some brands could find buyers, it looks like in this case the Gen Xers raised on Hostess snacks are losing an icon.

People are rushing to the hostess stores to buy up anything hostess. Unfortunately, for one customer all the twinkies were gone at her local hostess store.

So what is next for Hostess? Read the article for the Washington Post. VIEW

About Mr. Castle

Speak Your Mind