Hostess asks to close, citing labor strike

maker of twinkies has filed for bankruptcy twice in 10 years

Los Angeles TimesNovember 17, 2012 

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, which makes Twinkies and Wonder Bread, has asked a judge for permission to go out of business and lay off its 18,500 workers. If approved, the company is expected to sell off its assets, including its brands.

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 in the past 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.

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.

"The crisis facing Hostess Brands is the result of nearly a decade of financial and operational mismanagement that resulted in two bankruptcies, mountains of debt, declining sales and lost market share," said union President Frank Hurt.

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

Lexington Herald-Leader is pleased to provide this opportunity to share information, experiences and observations about what's in the news. Some of the comments may be reprinted elsewhere in the site or in the newspaper. We encourage lively, open debate on the issues of the day, and ask that you refrain from profanity, hate speech, personal comments and remarks that are off point. Thank you for taking the time to offer your thoughts.

Commenting FAQs | Terms of Service