Judge orders Hostess to mediate with union
A Hostess Twinkies sign is shown at the company's plant in Ogden, Utah, in this Nov. 15, 2012, file photo. / AP Photo/Rick Bowmer
Twinkies won't die that easily after all.
Hostess Brands Inc. and its second largest union will go into mediation to try and resolve their differences, meaning the Irving, Texas-based company won't go out of business just yet. The news came Monday after Hostess moved to liquidate and sell off its assets in bankruptcy court citing a crippling strike last week.
- Twinkies maker Hostess going out of business
- Hostess closure sparks Twinkies rush
- Crave a Twinkie? The price is going up fast online?
The bankruptcy judge hearing the case says that the parties haven't gone through the critical step of mediation and asked the lawyer for the bakery's union to ask his client, who wasn't present, if he would agree to participate.
The case is being heard by the U.S. Bankruptcy Court in the Southern District of New York in White Plains, N.Y.
Hostess, founded in 1930, said Nov. 16 it is going out of business and laying off all of its 18,500 workers after a national strike crippled its operations. The privately held Texas company filed for protection in January, its second trip through bankruptcy court in less than a decade.
The company's planned liquidation would result in the closure of 33 bakeries, 565 distribution centers and 570 bakery outlet stores, according to Hostess.
Thousands of members of the Bakery, Confectionery, Tobacco Workers and Grain Millers International Union went on strike last week after rejecting in September a contract offer that cut wages and benefits. Hostess had already reached a contract agreement with its largest union, the International Brotherhood of Teamsters.
"Many people have worked incredibly long and hard to keep this from happening, but now Hostess Brands has no other alternative than to begin the process of winding down and preparing for the sale of our iconic brands," CEO Gregory F. Rayburn said in a letter to employees last week.
Popular on MoneyWatch
- How to stop the mediocrity pandemic
- Reverse cell phone lookup service is free and simple
- Apple's Cook says company doesn't use "tax gimmicks"
- Top five 529 college plans
- LinkedIn: 3 tips for building a better profile
- Top 10 professional life coaching myths
- Amy's Baking Company: Post-meltdown PR campaign
- How to organize your job hunt