You get a big delight in every bite…

$860 million in debt

Just how much would Hostess workers wages have to be cut in order for it to make sense for another company to buy Hostess?

Will the new company have to pay off all or some of the debt? Since the hedge funds owning the company owe allot of the debt to themselves I presume they will get paid. But other creditors like the people who supply Hostess sugar, flour etc will be screwed as will Hostess workers pension fund.

Twinkie Town!!

Isn’t that the way it works? The funds make their money by stiffing workers, vendors, etc.?

Mitt did something similar he raided the pension fund then closed the company and left the company on the hook for debt but his Hedgefund was the first Creditor to get paid. The Government was on the hook for the pension fund.
Now then what kind of system to we have where the idiots who drove a company into bankruptcy in the first place are the first Creditor to get paid, and the tax payer gets stuck with the debt to the underfunded pension fund the company looted?

and the Baining of America

That is how it works but the system then is actually rewarding hedgefunds for shutting down companies. This is worse than eating your seed corn its taking a crap on your seed corn and then eating it.

Given the number of failed IPOs Facebook comes to mind and the current drop in the stockmarket I wonder if the hedgefunds that own Hostess will be able to find a buyer willing to take on that much debt?
Given the shelf life of Hostess products I wonder if moving production to China and shipping in the cupcakes would make Hostess profitable even with that much debt.
But of course low cost Chinese production often brings worry about quality control and with food health concerns.
Hostesses brand will take a hit if they move to China.

Something like that led to Mad Cow disease.

Around here it’s TastyKakes

Can we get the front pagers to weigh in on stupid bankruptcy laws that let the idiots who bankrupt a company get paid first in bankruptcy?
Capitalism should not be about rewarding failure and making a profit off of failure.

Yes morons took sick sheep spines and brains ground them up and sold them as cattle feed.

That’s the whole thing: The vultures who snapped up Hostess had no intention of making the company healthy again. They just wanted to see how much more coin they could take from its workers before they dropped the ax and then Hoovered up what value was still extant in Hostess’ dismembered corpse.

I love the chocolate cupcakes but then I’m a certifiable chocoholic

I saw 30% somewhere plus benefits.

I am stunned.

No more Twinkies.

Being called a ‘twinkie’ was to be accused of being less than a man. A mamma’s boy.

Dan White used the ‘Twinkie Defense‘ – diminished capacity – after killing Harvey Milk and Mayor George Moscone (I was living in SF then). He got charged ‘second degree’ for the clearly premeditated murders and 3 years.

At some point in my 40′s, I thought to eat a Twinkie for the sake of childhood nostalgia -I was astonished at the truly vile, chemical taste. Had Twinkies changed? Had I?

My spell checker keeps insisting that there is no singular form for ‘Twinkies’

Oh, what a brave new world that has no such features in it.

I am proud to say I have never had a twinkie. Or maybe, just one. But not more than that. I grew up eating beignets or, as we call them in my family, gut bombs. Never ate at McDonalds until I was in my thirties. My sister tells me this in not true. That we ate at one several times as teenagers. Could it be that I am in junk food history denial?

American mass culture is a sugar castle in the sand. When the seas rise, it might simply dissolve.

yes

Sweet essay.

Interesting. Now, growing up, Hostess snack cakes were not allowed in our home, but to show the power of commercials and social engineering on children, I felt cheated at the time, because other kids were eating Hostess for after-school snacks. Sometimes, I sneaked into the woods with a Hostess pie.

That said, I am sad for the workers of this company, getting this news, in this economy, right here before the holiday season. My heart goes out to them.

It should be noted that when the hedgefunds bought Hostess they assumed its debts and responsibilities for its pension fund.
They had a business plan they presented to the banks Hedgefunds use other people’s money “leverage” and the banks approved the plan.
Now then just what business plan did they approve to make $860 million in debt seem like a way to make a profit?
Cut cost! Increase sales! make production more efficient! make management more efficient! all the usual buss words but would a reasonable man think those numbers were realistic in the real world?
Had this been done before on such a scale as to make Hostess worth $860 million in debt?
Or do the numbers only work if they raided the pension fund? If they committed fraud and had no intension of funding the pension fund?
If the plan all along was to bankrupt the company after skimming that should have gone to the pension fund then selling the now bankrupt company at a profit?
Of course to morons seemed to forget that in this economy they very well might not get any buyers. Sure if someone buys the name Hostess and moves production to China they can make money.
But nobody will buy all of Hostess’s bakeries in non right to work states and all their debt. Nobody just for the name hostess will buy all their debt.
If investors are kicking themselves over facebook an IPO handled by the banks and hedgefunds will they trust a rosy happy talk about how much money a company with $860 million in debt has? I have no idea how much debt bankruptcy will clear but I assume the hedgefund will get paid and they loaned Hostess most of that debt.

This should be illegal plus its stupid! I “hint” would like to read a front pager post on this I am not a lawyer so bankruptcy questions are a bit beyond me plus this issue needs front pager attention not attention from a guy lucky to get 8 comments on a post.

Ahh thats what they say they want now but what if the true intent was to force the company into bankruptcy and sell the assets?
After facebook can we trust any bank or hedgefund to give us real numbers?

Never touched Twinkies after a friend bit into one and broke his tooth on a small marble.

Like that box of chocolates? Just don’t know. Safer to do without!

So how does one castrate cancerous parasites feeding on a hostess’s blood and life force?

According to an article published last summer by Fortune, labor relations at Hostess have been contentious for some time. In order to allow Hostess to come out of bankruptcy, management had wanted to cut wages by 8% this year, gradually giving back half of the cut over the next five years. In addition, management wanted to reduce its contributions to employees’ health care and pensions.

The biggest issue is that Hostess’ union pension funds are underfunded by $2 billion.

http://moneymorning.com/2012/11/16/hostess-brands-shutdown-highlights-looming-pension-crisis/

The workers gave up wages to save the company the hedgefunds bought the company knowing they had to pay the pension fund instead they paid themselves and skimmed the profits I doubt that even a 30% cut in wages can now service that debt so Hostess must go into bankruptcy.
But the banks that loaned the hedgefunds money knew all of this when they looked at Hostess’s books.
The banks and hedgefunds therefore had no intention of paying the pension fund when they bought the company evidence being they put no money in the pension fund and kept the cash for themselves this is Fraud!

No… Never… Not then and not now….

They lie……

It seems to me that Hostess workers should be able to sue the hedgefunds and the banks for their pension funds.

Forget Twinkies, what will become of my favorite…Hostess Sno Balls? Who could resist those chocolate mounds of cake filled with cream and covered with a layer of yummy marshmallow icing and coconut flakes.

Fortunately my partner actually has made an amazing cake version of this. But he has only made it once. It is not nearly enough.

@leliorisen

Obama should just wait awhile after hostess has no buyers then have the government buy the company but pay no cash to its hedgefund creditors and banks. just tell them they owe for the Pension funds out of the profits they took.

Would be nice. Ain’t gonna happen.

Agreed but then again Hostess won’t find a buyer for its bakeries in non right to work states either not at current prices plus enough to payback the hedgefundies.

I miss the comic book ads from the ’70s and early ’80s…Wonder Woman nabbing a jewel-thieving supervillainess with the aid of Twinkies, Green Arrow distracting the frightened kids he was attempting to rescue with Hostess fruit pies. Come back, good old days.

I think I can count the number of Hostess products I have ever eaten on two hands, maybe one.

Little Momma was the Sugar Queen, but she did a lot of baking until we were older, she was back at a job, and our capacity to eat was beyond her ability to keep up. I don’t know why she did not buy the stuff, but maybe it was less expensive to buy what she did.

It is sad the workforce has taken the beating, media have beat back the truth. Stand up, fight back!

What would it take for the workers to buy some of the individual bakeries and run them as cooperatives?

Since the goal of the vultures was to grab the pension fund (how can this be legal?), perhaps the physical plants and equipment could be bought for pennies on the dollar?

I paid over $2.50 recently for a small, gluten-free chocolate cupcake (and it wasn’t very good.) Surely experienced production people could do better.

The call is ‘ORGANIZE!’, but how to actually make it happen. Where would these workers look for help?

Not the government, for sure.

Maybe they can take the bakery to China. We know that Twinkies can make the ride from there to here and remain super extra fresh.

The 18,000 people who are losing their jobs are the ‘makers’. The vultures are the ‘takers’.

What could be more clear.

Being called a ‘twinkie’ was to be accused of being less than a man. A mamma’s boy.

Linda Ellerbee used “twinkie” to describe local news anchors. Imdb.com attributes this quote to her: “We call them Twinkies. You’ve seen them on television acting the news, modeling and fracturing the news while you wonder whether they’ve read the news – or if they’ve blow-dried their brains, too.”

When I was growing up in New Jersey, Drake’s products were a Basic Food Group, along with Taylor ham and scrapple.

When I moved to PA I was introduced to scrapple. It scared me.

Drakes IS Hostess.
“Drake’s was a baking company in Wayne, New Jersey, United States, owned by Hostess Brands”

oh well…

The acceptable face of spinach: what’s not to like about Saag Lamb?

The insidious thing about cultural superficiality is that the easiest escape from it is more cultural superficiality. I feel guilty about eating a Twinkie, panic ensues, the need for comfort and escape grows, so I eat another Twinkie. The more we hear about the Kardashians, the more we gotta hear about the Kardashians.

This.