Story Summary

Hostess Worker Strike

A potential strike could threaten thousands of jobs at Hostess Brands, the company notes.

The company has 69 locations in California and up to 1,800 jobs could be affected locally.

In November, workers decided to strike. On November 16, the company filed for permission to close some of their plants.

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NEW YORK (CNNMoney) — It’s Twinkies comeback day at Wal-Mart, three days ahead of the snack’s anticipated return nationwide.

Wal-Mart is rolling out the first batch of new Twinkies in 1,600 stores on Friday. And by Sunday, Twinkies will be available in 3,000 Wal-Mart stores, according to company spokeswoman Veronica Marshall.

Wal-Mart is selling Twinkies in an exclusive collectible box that says “First Batch” on the packagaing and the new Twinkies tagline: “The Sweetest Comeback in the History of Ever.” They cost $2.98 for a box of 10.

“These are the first production of Twinkies since production restarted,” Marshall said. “Each box that arrived to us contains fresh Twinkies and not frozen ones.”

Wal-Mart had planned to start selling Twinkies on Monday but pushed up the date when it was able to “get the inventory earlier,” Marshall said.

On Sunday, Wal-Mart will also start selling other Hostess-branded products, including mini muffins, fried fruit pies and cupcakes. The retailer will roll out Ho Hos, Zingers and SuzY Q in late August, and the cream-filled chocolate Sno Balls in late fall, according to Marshall.

Twinkies and other Hostess products have not been produced since November, when Hostess Brands Inc. filed for bankruptcy to liquidate its 82-year-old business following a strike.

The new snack company, Hostess Brands LLC, was bought out of bankruptcy for $410 million by private equity groups Apollo Global Management.

Does Wal-Mart anticipate a Twinkies rush this weekend? It could happen, Marshall said. “But we guarantee we’ll keep Twinkies in stock.”

 

By Parija Kavilanz. The-CNN-Wire/Atlanta/+1-404-827-WIRE(9473)
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A rare and delicious treat no longer, as the Twinkie will be returning to shelves on July 15.

NEW YORK (CNNMoney) — Good news Twinkies fans, your beloved snack is due back on shelves on July 15.

The announcement was made by Daren Metropoulos, principal of Metropoulos & Co., one of the two companies that bought the rights to Twinkies and other snack brands from the bankrupt Hostess Brands earlier this year.

The new Twinkies box will look very similar to the old one, with the addition of the line “The sweetest comeback in the history of ever.” The price will stay the same as last fall when Hostess shut down – $3.99 for a box of 10. Other products will also come back with the same pricing.

“America wanted Hostess back — they wanted the original,” said Metropoulos.

The new company will sell all of the Hostess and Dolly Madison branded snack products, including CupCakes, Donettes, Zingers, Ho Hos, Ding Dongs, fruit pies and mini muffins. Some products, such as Sno Balls, will take a little longer to return to shelves, but they should be available within the next few months.

Other Hostess brands, including Wonder Bread and Drake’s snack cakes, have been sold to other firms. Details of their return have yet to be announced.

Wonder Bread, Twinkies and other Hostess products have not been produced since November, when Hostess Brands Inc. filed with the bankruptcy court to liquidate its 82-year old business following a crippling strike by the Bakery Workers union.

But while that company is out of business, and most of its 18,500 employees have lost their jobs, a bankruptcy court has been overseeing an auction of its various brands as part of the liquidation process.

The new snack company, Hostess Brands LLC, was purchased for $410 million by private equity groups Apollo Group and Metropoulos & Co. It also bought five of the closed bakeries as part of their bid. It will produce the products out of four of the bakeries — in Columbus, Ga., Emporia, Kansas, Indianapolis and the Chicago suburb of Schiller Park, Ill. It plans to have about 1,800 employees making the snacks within the next three months.

Metropoulos’ other food holdings include Pabst Blue Ribbon beer. In the past it has owned Chef Boyardee canned pasta, Bumble Bee seafood, PAM cooking spray and Gulden’s Mustard, all of which it eventually sold to ConAgra Foods Inc.

 

By Chris Isidore

–CNN’s Polina Fishof contributed to this report

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Twinkies Saved?: Sun Capital Wants to Buy HostessNEW YORK (CNNMoney) — Twinkies and other Hostess snacks could be back on shelves by this summer after a successful $410 million bid for the business.

The winning bid is a joint venture by private equity firms Apollo Global Management and Metropoulos & Co. A statement from Dean Metropoulos, founder of one of the firms, confirmed they are the winning bidder.

“Our family is thrilled to have the opportunity to reestablish these iconic brands with new creative marketing ideas and renewed sales efforts and investment,” said Metropoulos. “We look forward to having America’s favorite snacks back on the shelf by this summer. We are also ecstatic to bring jobs back to many cities across the country.”

The bankruptcy court had been set to have an auction among qualified bidders on Thursday, but Hostess notified the court late Monday that no other qualified bids had been submitted. That means the $410 million bid wins by default with no further approval of the court being required.

Hostess had no comment on the deal beyond the filing.

Wonder Bread, Twinkies and other Hostess products have not been produced since November, when the company filed with the bankruptcy court to liquidate its business following a crippling strike by the Bakery Workers union.

But while Hostess is out of business, and most of its 18,500 employees have lost their jobs, the company has been auctioning off its various brands as part of the liquidation process.

Metropoulos has experience turning around financially troubled food brands. The firm’s food holdings include Pabst Blue Ribbon beer, and in the past have included Chef Boyardee canned pasta, Bumble Bee seafood, PAM cooking spray and Gulden’s Mustard, all of which it eventually sold to ConAgra Foods In.

The joint bid by Apollo and Metropoulos had been tapped in January as the lead bidder for most of Hostess’ snack cake business, which includes both Hostess and Dolly Madison products, led by its iconic Twinkies brand. The bidders also bought five of the closed bakeries as part of their bid.

Flowers Foods won most of Hostess’ bread business on Feb. 28 with a $360 million bid that included the Wonder, Nature’s Pride, Merita, Home Pride and Butternut bread brands, as well as 20 bakeries.

Privately held McKee Foods Corp. was tapped as the leading bidder with its $27.5 million offer for Hostess’ Drake’s brand and some of its equipment. Drake’s products include Ring Dings, Yodels, Devil Dogs and Yankee Doodles, as well as its coffee cake. That bid is still pending.

 

 

By Chris Isidore

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WHITE PLAINS, New York (CNNMoney) -

Time finally ran out for Hostess Brands on Wednesday, as a bankruptcy judge gave preliminary approval to the baker’s request to liquidate the 82-year old company.A last-ditch attempt to mediate a pay-and-benefits dispute between the company and its Bakery Workers union failed.

The decision by Judge Robert Drain sets the stage for the company to start selling its assets — including its bakeries, brands and recipes.

“Sadly, the parties were not able to come to an agreement,” said Drain. “It’s a free country. People are free not to agree.”

Hostess, maker of such beloved products as Twinkies, Wonder Bread and Drake’s snacks, announced Tuesday night the mediation efforts had failed to produce a deal.

About 15,000 of the company’s current 18,500 employees will likely be terminated in the coming days. The company said in court it needs about 3,200 employees to stay on for various periods of time to wind down the company.

The company’s operations have been closed since last Friday. Hostess’ CEO and attorneys previously said that reaching a deal to restart the company’s network of 33 bakeries and 565 distribution centers would be difficult due to the financial damage done by the strike that started Nov. 9.

But Hostess’ investment bankers testified that there have been dozens of inquiries about a possible purchase of various brands and even some facilities. Joshua Scherer, of Perella Weinberg, told the court that some of the interested parties had inquired about hiring back some workers.

“It’s a once in a lifetime opportunity for [Hostess'] competitors,” he testified.

Hostess CEO Greg Rayburn told reporters after the hearing that the company would move as quickly as possible to sell the brands, although he would give no specific time frame for when the iconic products could be available to consumers once again.

“The longer we’re off the shelves, the less value we’re going to get,” he said. He said it’s difficult to handicap the chances that Hostess workers could be rehired by those who buy assets.

Asked by CNNMoney if the sale would be strictly to the highest bidder or whether the buyer’s interest in hiring workers would be a consideration, Rayburn said “You have to try to do both.”

On Monday, private equity firm Sun Capital Partners told Fortune that it wants to buy Hostess as a going concern. It would reopen the shuttered factories, and keep the Hostess workers and their unions. But it’s not clear Sun Capital’s offer would top those of other bidders who would simply produce the product with the bidders’ existing facilities, leaving the Hostess workers out of luck.

Drain scheduled another hearing on Nov. 29. At that time, he will consider Hostess’ request for approval of $1.75 million in bonuses, ranging from $7,400 to $130,500, to be paid to 19 executives to oversee the liquidation of the company. Hostess said it needs the bonuses to make sure the executives it needs stay with the company through the end.

“The cessation of … operations is not a simple matter of turning off the lights and shutting the doors,” the company wrote in a court filing on Friday.

Unions at Hostess are on record opposing the bonus requests. The Justice Department’s bankruptcy trustee in the case has also filed an objection to the bonus plan.

The Bakery Workers union has repeatedly said that mismanagement and the debt placed on the company by its current and past owners were the reasons for the company’s failure, not the strike. It said its membership was overwhelmingly opposed to the wage and benefit concessions agreed to by other Hostess employees, including the majority of the 6,700 members of the Teamsters’ union at Hostess.

The Teamsters issued a statement Tuesday saying the failure of mediation and the likely liquidation of the company was a tragic outcome. It did not comment on who it blamed for the shutdown.

A statement last week blamed poor management for the shutdown, but also appeared to also criticize the bakers’ union without explicitly naming it, saying that “not all stakeholders were willing to be constructive.”

By Chris Isidore and James O’Toole

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NEW YORK (CNNMoney) — Hostess Brands said Tuesday evening that a last-ditch mediation session with its bakers’ union over a new contract imposed in bankruptcy court had failed, bringing the company closer to liquidation.

Hostess said in a brief statement that the mediation session “was unsuccessful,” and that it had no further comment ahead of a hearing scheduled for Wednesday morning in bankruptcy court, where it has requested permission to liquidate.

Jeff Freund, a lawyer for the bakers’ union, declined to comment, citing mediation ground rules.

Last Friday, management announced a shutdown of Hostess. They appeared before U.S. Bankruptcy Judge Robert Drain on Monday afternoon seeking approval to liquidate and sell off the company’s assets. But Drain said he wanted the parties to try one last time to reach agreement, serving as the mediator at Tuesday’s session.

Drain said he was motivated by the prospect of saving the roughly 18,500 jobs at Hostess, maker of Twinkies and Wonder Bread.

Only one day of talks was scheduled. Hostess CEO Greg Rayburn said Monday that the company would need an answer from the bakers’ union on whether it would accept the new contract by the end of the day Tuesday.

With Tuesday’s talks having failed, liquidation and the loss of Hostess’ jobs appeared likely.

The bakers’ union, which represents 5,000 of the 18,500 employees, went on strike on Nov. 9 to protest a new contract that imposed wage and benefit cuts. Other unions, including the International Brotherhood of Teamsters, had accepted the deal.

“As we said on Friday when the company announced it was closing, this is a tragic outcome and our thoughts and prayers go out to all Teamster Hostess members and all Hostess employees,” Teamsters General Secretary-Treasurer Ken Hall said in a statement Tuesday.

If the company goes into liquidation, its brands and recipes will be sold off to raise funds to pay creditors.

On Monday, private equity firm Sun Capital Partners told Fortune that it wants to buy Hostess as a going concern. It would reopen the shuttered factories, keeping the Hostess workers and their unions.

But others vying for the rights to Hostess products could simply produce them at their own facilities, leaving former Hostess employees out of jobs.

James O’Toole filed this report.

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Hostess now negotiating with union members, FOX40′s Eric Rucker was at one Hostess location right here in our area.

WHITE PLAINS, N.Y. (CNNMoney) — Hostess Brands and a key union agreed Monday to try to mediate their dispute in coming days — an unexpected development that could spare the company from permanently shutting down.

The Bakery Workers union, which represents 5,000 of the 18,500 employees at the maker of Twinkies and Wonder Bread, went on strike on Nov. 9. The company had imposed paycuts and other concessions on its membership.

On Friday, management announced a shutdown of Hostess and appeared before U.S. Bankruptcy Judge Robert Drain Monday afternoon seeking approval to liquidate the company.

But Drain said he wanted the parties to try one last time to reach agreement. Drain will serve as the mediator at a session scheduled for Tuesday afternoon. Only one day of talks is set for now.

CEO Greg Rayburn said the company needs a final decision on Tuesday.

Tom Becker, spokesman for Hostess, said operations at its plants and distribution centers nationwide remain shutdown. They were closed Friday morning when the company announced plans to liquidate.

A spokesman for the Baker Workers union could not be immediately reached for comment. A spokesman for the Teamsters union, which represents 6,700 workers at Hostess, said he could not comment on the mediation.

Hostess has announced its intention to sell its brands, recipes for various products and other assets as a way to generate cash for its creditors. Even if the products are purchased by other companies and once again sold to consumers, most potential buyers are unlikely to rehire Hostess employees to produce or deliver those products.

One hope for the unions and the employees was raised earlier in the day Monday when private equity firm Sun Capital Partners disclosed it wants to buy Hostess as a going concern, including reopening the shuttered factories and continuing union representation of Hostess workers.

Before Sun Capital’s interest was first reported by Fortune Monday, the unions’ statements and filings seemed resigned to the fact that Hostess will be closed down and the hourly workers will be out of work.

The Bakery Workers union issued a statement Saturday citing mismanagement over a number of years for the company’s troubles.

“Hostess failed because its six management teams over the last eight years were unable to make it a profitable, successful business enterprise,” said the union.

But it said its members understood when they went on strike that a shutdown of the company would likely occur.

“They were well aware of the potential consequences of their actions but stood strong for dignity, justice and respect,” the union’s said.

By Chris Isidore and James O’Toole

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National & World News
11/16/12

Twinkie Shortage? Not for Those Willing to Bid Online

New boxes of Twinkies and other Hostess items are for sale on ebay.

Twinkies could become just a memory, and in this day and age, memories often turn into collector items.

Take a quick glance through ebay’s listings, and you’ll see about a dozen entries for a box of Twinkies – all added Friday, the day the indestructible pastry’s maker, Hostess, asked a court to go out of business.

Ebay entries for fresh Twinkies or other Hostess products prior to the bankrupt company’s Friday court filing? Zero.

Although the sweet-toothed entrepreneurs may have cleaned off store shelves and posted their wares online, it appears not many have a hankering for a Hoho, Zinger or Twinkie.

Of the almost dozen boxes listed as of Friday afternoon, only one has any bids, and bidding has reached a whopping $3.25.

Although, some of the other entries have suggested “buy it now” prices ranging from $39.99 to $7,000.00.

SACRAMENTO -

The Twinkies might last for decades, but Hostess is no more.

Friday, Hostess Brands Inc. asked a federal bankruptcy court for permission to shut down all of its plants, including the Sacramento facility, and to liquidate its business after 82 years of making some of the most popular treats in America.

Hostess managers say the November 9th nationwide strike is what finally killed the company.

Nearly 20,000 workers will lose their jobs, including the Sacramento-based employees.

This doesn’t mean that Twinkies and Wonder Bread will disappear from store shelves forever, though.  Another company could purchase the assets out of bankruptcy and resurrect the 30 different brands.

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