Saturday, April 19, 2014
FAIRFIELD-SUISUN, CALIFORNIA
99 CENTS

Twinkies maker Hostess ready for its big bake sale

Hostess Brands Strike

The Wonder Hostess Bakery Thriftshop is shown at the Utah Hostess plant in Ogden, Utah, Thursday, Nov. 15, 2012. Hostess Brands Inc. is warning striking employees that it will move to liquidate the company if plant operations don't return to normal levels by Thursday evening. The maker of Twinkies, Ding Dongs and Wonder Bread said Thursday it will file a motion in U.S. Bankruptcy Court to shutter operations if enough workers don't return by 5 p.m. EST. That would result in the loss of about 18,000 jobs, including hundreds in Ogden. (AP Photo/Rick Bowmer)

NEW YORK — The future of Twinkies is virtually assured.

Hostess Brands Inc. got final approval for its wind-down plans in bankruptcy court Thursday, setting the stage for its iconic snack cakes to find a second life with new owners – even as 18,000 jobs will be wiped out.

The company said in court that it’s in talks with 110 potential buyers for its brands, which include CupCakes, Ding Dongs and Ho Hos. The suitors include at least five national retailers such as supermarkets, a financial adviser for Hostess said. The process has been “so fast and furious” Hostess wasn’t able to make its planned calls to potential buyers, said Joshua Scherer of Perella Weinberg Partners.

“Not only are these buyers serious, but they are expecting to spend substantial sums,” he said, noting that six of them had hired investment banks to help in the process.

The update on the sale process came as Hostess also received approval to give its top executives bonuses totaling up to $1.8 million for meeting certain budget goals during the liquidation. The company says the incentive pay is needed to retain the 19 corporate officers and “high-level managers” for the wind down process, which could take about a year.

Two of those executives would be eligible for additional rewards depending on how efficiently they carry out the liquidation. The compensation would be on top of their regular pay.

The bonuses do not include pay for CEO Gregory Rayburn, who was brought on as a restructuring expert earlier this year. Rayburn is being paid $125,000 a month.

Hostess was given interim approval for its wind-down last week, which gave the company the legal protection to immediately fire 15,000 union workers. The company said the terminations were necessary to free up workers to apply for unemployment benefits. About 3,200 employees are being retained to help in winding down operations, including 237 employees at the corporate level.

The bakers union, Hostess’ second-largest union, has asked the judge to appoint an independent trustee to oversee the liquidation, saying that the current management “has been woefully unsuccessful in its reorganization attempts.”

Hostess had already said last week that it was getting a flood of interest from potential buyers for its brands, which also include Devil Dogs and Wonder bread. The company has stressed it needs to move quickly to capitalize on the outpouring of nostalgia sparked by its liquidation.

“The longer these brands are off the shelves, the less they’re going to be valued,” Scherer said Thursday in U.S. Bankruptcy Court in the Southern District of New York in White Plains, N.Y.

Last week, Scherer had noted that it was a “once-in-a-lifetime opportunity” for buyers to snap up such well-known products without the debt and labor contracts that would come with the purchasing the entire company. Although Hostess sales have been declining over the years, they still clock in at between $2.3 billion and $2.4 billion a year.

Scherer also said a surprising number of potential buyers have expressed interest in most of its three dozen factories.

The company’s demise came after years of management turmoil and turnover, with workers saying the company failed to invest in updating its products. In January, Hostess filed for its second Chapter 11 bankruptcy in less than a decade, citing steep costs associated with its unionized workforce.

Although Hostess was able to reach a new contract agreement with its largest union, the Teamsters, the bakers union rejected the terms and went on strike Nov. 9. Hostess announced its plans to liquidate a week later, saying the strike crippled its ability to maintain normal production.

In court Thursday, an attorney for Hostess noted that the company is no longer able to pay retiree benefits, which come to about $1.1 million a month. Hostess stopped contributing to its union pension plans more than a year ago.

Toward the end of the hearing, a man who said he’d worked for Hostess for 34 years stood to give his objections to the wind-down plan, saying creditors shouldn’t be paid when the company hasn’t been making its contributions to workers’ pension funds.

“I have traveled pretty far to get here,” he said, noting that many of his co-workers didn’t know how to get to the hearing and speak for themselves. “I just wanted to be heard.”

The Associated Press

The Associated Press

LEAVE A COMMENT

Discussion | No comments

The Daily Republic does not necessarily condone the comments here, nor does it review every post. Read our full policy

.

Solano News

Solano unemployment inches downward

By Barry Eberling | From Page: A1

 
Transplant recipients talk about their best gifts

By Amy Maginnis-Honey | From Page: A1 | Gallery

 
Implementing Common Core: A work in progress

By Mayrene Bates | From Page: A2

Police release name of woman found dead in Fairfield canal

By Ryan McCarthy | From Page: A3 | Gallery

 
Spering, Bertani spar over fighting crime

By Ryan McCarthy | From Page: A3, 5 Comments | Gallery

 
Fairfield council candidates weigh in on crime

By Ryan McCarthy | From Page: A3 | Gallery

 
Jury acquits substitute teacher in child abuse case

By Jess Sullivan | From Page: A4

 
Five homes featured on Symphony Home Tour

By Amy Maginnis-Honey | From Page: A4

Congregation invites public to Easter music, message

By Amy Maginnis-Honey | From Page: A4

 
 
Local woman helps spread Easter joy

By Amy Maginnis-Honey | From Page: B12 | Gallery

Weather for April 19, 2014

By Daily Republic | From Page: B13

 
.

US / World

California farmers to get more water

By The Associated Press | From Page: A1

 
Teen sentenced in Oakland toddler’s killing

By The Associated Press | From Page: A4

More Latino than white students admitted to UC

By The Associated Press | From Page: A4

 
PG&E to be arraigned in fatal pipeline blast

By The Associated Press | From Page: A5

Mom and son who died in San Francisco fire ID’d

By The Associated Press | From Page: A5

 
3 alleged gang members convicted of murder

By The Associated Press | From Page: A5

Health care site flagged in Heartbleed review

By The Associated Press | From Page: A5

 
From Clinton to Obama, many parallels

By The Associated Press | From Page: A5

Study: Half of jailed NYC youths have brain injury

By The Associated Press | From Page: A5

 
Easter on 4/20, pot holy day; pastors reach out

By The Associated Press | From Page: A8

Colorado deaths stoke worries about pot edibles

By The Associated Press | From Page: A8

 
NASA’s moon-orbiting robot crashes down as planned

By The Associated Press | From Page: A8

Atheist national conference aims at Mormon church

By The Associated Press | From Page: A8

 
White House updating online privacy policy

By The Associated Press | From Page: A9

SpaceX making Easter delivery of station supplies

By The Associated Press | From Page: A9

 
Sudden movement raises alarm in Wyoming slide area

By The Associated Press | From Page: A9

Some countries get Obama, but want his wife, too

By The Associated Press | From Page: A9

 
Man who avoided prison is overwhelmed by support

By The Associated Press | From Page: A9

Teen suspended for asking Miss America to prom

By The Associated Press | From Page: A9

 
In Egypt, a corruption watchdog hit by backlash

By The Associated Press | From Page: A12

Military scales down, modifies Guam buildup plan

By The Associated Press | From Page: A13

 
Captain of sunken SKorean ferry arrested

By The Associated Press | From Page: A13

Avalanche sweeps down Everest, killing at least 12

By The Associated Press | From Page: A13

 
Diplomacy doesn’t move insurgents in Ukraine

By The Associated Press | From Page: A14

Magnitude-7.2 earthquake shakes Mexican capital

By The Associated Press | From Page: A14

 
57-nation OSCE plays key Ukraine monitoring role

By The Associated Press | From Page: A14

Ukraine crisis: The turning points

By The Associated Press | From Page: A14

 
.

Opinion

Cheers, jeers for the week of April 13-19, 2014

By Daily Republic | From Page: A11

 
Time to fix a law the courts have mucked up

By Thomas Elias | From Page: A11

Editorial Cartoons for April 19, 2014

By Daily Republic Syndicated Content | From Page: A11

 
Here we go again in Sacramento

By Letter to the Editor | From Page: A11

 
.

Living

Today in History for April 19, 2014

By The Associated Press | From Page: A2

 
Community Calendar: April 19, 2014

By Susan Hiland | From Page: A2

Seniors, it’s never too late to do something about your health

By Kathy Mitchell and Marcy Sugar | From Page: B7

 
Horoscopes for April 19, 2014

By Holiday Mathis | From Page: B7

.

Entertainment

TVGrid

By Daily Republic Syndicated Content | From Page: B10

 
Prince reaches agreement with music label

By The Associated Press | From Page: B14

‘The Boondocks’ back for final ‘offensive’ season

By The Associated Press | From Page: B14

 
A nutty finale for ‘Scandal,’ TV’s craziest show

By The Associated Press | From Page: B14

Stratocaster still a favorite at 60

By The Associated Press | From Page: B14

 
.

Sports

Hertl has impressive playoff debut for Sharks

By The Associated Press | From Page: B1

 
Warriors and Clippers take dislike to playoffs

By The Associated Press | From Page: B1

Big innings lift Mustangs over Indians

By Paul Farmer | From Page: B1 | Gallery

 
Ross, Padres beat Cain and Giants 2-1

By The Associated Press | From Page: B1 | Gallery

A’s come out swinging to beat Astros 11-3

By The Associated Press | From Page: B1

 
Warriors to start O’Neal for Bogut vs. Clippers

By The Associated Press | From Page: B1

Avalanche sweeps down Everest, killing at least 12

By The Associated Press | From Page: B2

 
Mets trade 1B Ike Davis to Pirates

By The Associated Press | From Page: B2

TNT’s Sager to miss NBA playoffs due to leukemia

By The Associated Press | From Page: B2

 
Nadal ousted by Ferrer in Monte Carlo quarters

By The Associated Press | From Page: B2 | Gallery

A’s lefty reliever Doolittle gets 5-year deal

By The Associated Press | From Page: B2 | Gallery

 
’40-and-up club’: Ageless Hopkins after more belts

By The Associated Press | From Page: B2

Jimenez shoots 65 to lead Greater Gwinnett field

By The Associated Press | From Page: B2

 
Solano scores in ninth for 2-1 BVC baseball win over Yuba

By Daily Republic staff | From Page: B2

Choi leads rain-delayed RBC Heritage

By The Associated Press | From Page: B2 | Gallery

 
NBA’s Silver wants age limit change, no rush on others

By The Associated Press | From Page: B2

NBA playoffs looking more wide-open than expected

By The Associated Press | From Page: B2

 
Source: Grizzlies’ G Calathes suspended for 20 games

By The Associated Press | From Page: B2

.

Business

5 features an Amazon phone might offer

By The Associated Press | From Page: B10

 
Judge says American can’t end retiree benefits yet

By The Associated Press | From Page: B10

Mazda recalls 109,000 older SUVs for rust problem

By The Associated Press | From Page: B10

 
.

Obituaries

Sealwyn Shirley Brucefield Shepherd Malkiewicz

By Nancy Green | From Page: A4

 
.

Comics

Frank and Ernest

By Daily Republic Syndicated Content | From Page: B6

 
Get Fuzzy

By Daily Republic Syndicated Content | From Page: B6

Peanuts

By Daily Republic Syndicated Content | From Page: B6

 
Sally Forth

By Daily Republic Syndicated Content | From Page: B6

For Better or Worse

By Daily Republic Syndicated Content | From Page: B6

 
Beetle Bailey

By Daily Republic Syndicated Content | From Page: B6

Rose is Rose

By Daily Republic Syndicated Content | From Page: B6

 
B.C.

By Daily Republic Syndicated Content | From Page: B6

Baby Blues

By Daily Republic Syndicated Content | From Page: B6

 
Pickles

By Daily Republic Syndicated Content | From Page: B6

Baldo

By Daily Republic Syndicated Content | From Page: B6

 
Blondie

By Daily Republic Syndicated Content | From Page: B6

Dilbert

By Daily Republic Syndicated Content | From Page: B6

 
Wizard of Id

By Daily Republic Syndicated Content | From Page: B6

Zits

By Daily Republic Syndicated Content | From Page: B6

 
Garfield

By Daily Republic Syndicated Content | From Page: B6

Word Sleuth

By Daily Republic Syndicated Content | From Page: B7

 
Sudoku

By Daily Republic Syndicated Content | From Page: B7

Bridge

By Daily Republic Syndicated Content | From Page: B7

 
Cryptoquote

By Daily Republic Syndicated Content | From Page: B7

Crossword

By Daily Republic Syndicated Content | From Page: B7

 
.

Home Seller 04/19/14

Summerwood features 8 new homes in Suisun

By Daily Republic | From Page: HSR2

Real estate transactions for April 19, 2014

By Daily Republic | From Page: HSR3

Average US 30-year mortgage rate falls to 4.27 percent

By The Associated Press | From Page: HSR3