Hostess Announces Closure, Intends To Liquidate Assets
Hostess has officially announced that it will close its doors and liquidate its assets, according to ABC News.
Since only a few striking workers returned to their jobs before the Thursday deadline set by the company, Hostess claims it has no choice but close up shop and sell off its assets to interested parties.
Not surprisingly, CEO Gregory F. Rayburn is unhappy about the situation.
“We deeply regret the necessity of today’s decision, but we do not have the financial resources to weather an extended nationwide strike,” Rayburn said. “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.”
The company has reportedly asked the court for permission to close for business and sell off its assets including its brands and treat-making facilities. All Bakery operations have been suspended for the time being. Any shipments that are currently in transit will be immediately returned to the supplier.
According to the Chicago Tribune, Hostess will be forced to lay off roughly 18,500 employees as a result of the liquidation. Rayburn stopped short of pointing the finger directly at the Bakery, Confectionery, Tobacco Workers and Grain Millers International Union for the situation.
“[Hostess] has done everything in its power to pursue a reorganization of its business as a going concern, including spending the better part of 18 months negotiating with its key constituents to obtain a consensual agreement,” the company explained in a statement.
“There’s no way to soften the fact that this will hurt every Hostess Brands employee. All Hostess Brands employees will eventually lose their jobs – some sooner than others,” Rayburn said in a letter to his employees.
When everything is said and done, Hostess will close 33 bakeries, 565 distribution centers, and 570 bakery outlet stores. Approximate 5,500 delivery routes will be shut down as well.
Are you saddened that Hostess has announced it will close its doors and liquidate its assets? Do you think this is the end of the Twinkie?