Hostess Brands Says It Will Liquidate

Hostess Brands Says It Will Liquidate

While Twinkies have a reputation for an unlimited shelf life, the company that makes the junk food does not.

Hostess Brands, the bankrupt maker of cream-filled pastries like Twinkies and Ho Hos, said on Friday that it plans to wind down its operations. The decision comes a week after one of the company’s biggest unions went on strike to protest a labor contract.

But that means that Twinkies, Ding Dongs and Wonder Bread may find new life under a different owner, once the company begins an auction of its brands and assets.

The work stoppage by the Bakery, Confectionery, Tobacco Workers and Grain Millers Union affected nearly two-thirds of Hostess’ factories across the country. The company first responded by permanently closing three factories, then gave union members until 5 p.m. on Thursday to return to work.

“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. He added that the vast majority of its 18,500 employees would be laid off.

Friday’s decision may spell the end of Hostess, a company that has endured wars, countless diet fads and even an earlier Chapter 11 filing. But with the national appetite for the junk food of yore on the wane, the baked-goods maker fell on hard times.

It sought bankruptcy protection a second time — known within restructuring circles as a “Chapter 22″ — in January and attempted to reorganize its finances, principally by cutting labor costs.

Hostess’ advisers will soon begin to shut down the company’s 33 bakeries and 565 distribution centers.


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