Twinkie maker Hostess closing up U.S. shop

Published On November 16, 2012 | By HN Staff | News

Twinkies are one of Hostess’s most popular snack cakes. COURTESY WIKICOMMONS

Compiled by Jessy Bains

Hostess Brands Inc. was not bluffing when it promised to shutdown all operations if striking employees didn’t get back to work.

The iconic Wonder Bread and Twinkie maker based in Irving, Texas announced Friday it would begin liquidating assets.

USA Today reported Wedrick Hollingsworth, business agent for Local 372-B of the bakers union, said union members took wage and benefit concessions four years ago and are unwilling to accept further wage cuts and reductions in health and pension benefits sought by the company.

According to a news release on the company website, Hostess has already shut down operations in 33 plants around the United States.

“Hostess Brands will move promptly to lay off most of its 18,500-member workforce and focus on selling its assets to the highest bidders,” said CEO Gregory Rayburn in a news release.

The wind down also means the closure of 565 distribution centers, approximately 5,500 delivery routes and 570 bakery outlet stores throughout the United States.

Impact of Hostess shutdown. INFOGRAPHIC BY JESSY BAINS

“We deeply regret the necessity of today’s decision, but we do not have the financial resources to weather an extended nationwide strike,” said Rayburn in a statement.

The Bakery, Confectionery, Tobacco Workers and Grain Millers International Union represent around 5,000 Hostess employees.

According to the Toronto Star, Lance Ignon, a spokesman for Hostess, said the strike had seriously affected production at around a dozen of the company’s plants.

“I don’t know if they thought that was a bluff,” CEO Gregory Rayburn said of the workers on CNBC Friday.

Montreal based Saputo Inc. holds the license to sell Hostess Brand snack cakes in Canada, while Weston Bakeries Ltd. of Toronto produces bread under the Wonder Bread label.

Upon the writing of this article, neither Canadian company has made an announcement addressing how this will affect their operations.

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