Hostess files for bankruptcy, competitors seek to purchase

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Hostess Brands, the maker of the iconic Twinkies, announced Friday it is going out of business, creating an opportunity for competitors to purchase the brand.

The news comes after Hostess bakers went on strike protesting a new contract that was being forced on them. Nearly 18,500 workers will lose their jobs in the company, shutting down 33 bakeries and 565 distribution centers nationwide, CNN reports.

"We deeply regret the necessity of today's decision, but we do not have the financial resources to weather an extended nationwide strike," said CEO Gregory Rayburn in a statement, CNN reports.

Hostess will sell its assets to the highest bidder. Mexico's Grupo Bimbo, the world's largest bread-baking firm, is interested in obtaining some of the Texas-based Hostess' products, according to Forbes. Grupo Bimbo "owns parts of Sara Lee, Entenmann's and Thomas English Muffins", FOX News reports.

Others firms considered prospects include Pepperidge Farm, a division of Campbell Soup Co.; ConAgra and Flowers Food, the American company behind Nature Valley granola; and McKee Foods, baker of Little Debbie snack cakes, the Christian Science Monitor reports. (FOX News reports)

Approval of the bankruptcy court is still needed before Hostess will start selling its assets. Meanwhile, production of all of its bakeries stopped Friday, and stores will no longer receive products from Hostess Brands after the final round of deliveries were made Thursday night, CNN reports.

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This page contains a single entry by snyde509 published on November 18, 2012 2:15 PM.

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