by Christopher Freeburn | November 21, 2012 10:30 am
Hostess Brands said on Tuesday that a last-ditch effort to find an agreement with its bakers union had failed and that the company would ask the bankruptcy court to sign off on its shutdown.
Last week, Hostess asked the bankruptcy court for permission to terminate operations after the bakers union missed a Thursday deadline to end a strike that had crippled production at the struggling snack food maker.
However, the judge asked the parties to make a final attempt to resolve their contract issues. The judge noted that there were “serious questions as to the logic” of the bakers union’s actions, Bloomberg noted.
Hostess, which has been under bankruptcy protection since January — its second run through the bankruptcy courts in a decade — had persuaded its other unions to agree to lower wages and benefits. However, the Bakery, Confectionery, Tobacco & Grain Millers Union, which represents 5,000 of the company’s 18,500 workers, refused to accept a new contract with diminished compensation and launched a strike that halted operations at a number of Hostess facilities.
A representative of the Teamsters, Hostess’ largest union, called the failed mediation talks a “tragic outcome.”
The maker of the iconic Twinkies snack cakes will now seek to shut down its facilities and sell its assets, likely including its snack food brands.
Source URL: http://investorplace.com/2012/11/hostess-seeks-shutdown-after-failed-mediation/
Short URL: http://invstplc.com/1nz6BNx
Copyright ©2016 InvestorPlace Media, LLC. All rights reserved. 700 Indian Springs Drive, Lancaster, PA 17601.