Hostess Brands including Twinkies and Wonder Bread, is filing for bankruptcy which led to many die-hard Twinkies fans around the nation to stockpile on their favorite snack before there are no more.
Hostess Brands have been in and out of bankruptcy and was already struggling from a high cost structure and sluggish consumer demand for its products.
The company said it could go into liquidation if its bakers continue striking in protest against wage and benefit cuts imposed in bankruptcy court. After reaching a new contract with workers union, they have been required to cuts salaries across the company by 8 percent in the first year of the five-year agreement. Salaries then bump up 3 percent in the next three years and 1 percent in the final year.
Just hours after the news broke, stories and photos began surfacing of cleaned-out grocery shelves across the country as fans made a run on Twinkies and other Hostess products. Spokespeople from Wal-Mart and Kroger had no comment as to whether the retailers were prepared for a potential onslaught of would-be stockpilers. NBC News correspondent Mara Schiavocampo purchased a "lifetime supply" of Twinkies, saying, "they are my single favorite junk food indulgence."
"We'll be selling the brands and as much of the infrastructure as we can," said company spokesman Lance Ignon, according to Reuters. "There is value in the brands. But some bakeries will never open again as bakeries."
The Irving, Texas-based company said the liquidation would mean that most of its 18,500 employees would lose their jobs. Hostess immediately suspended operations at all of its 33 plants across the United States as it moves to start selling assets.
The company said it was closing bakeries in Seattle, St. Louis and Cincinnati in response to the strike, cutting 627 jobs in total. The bakers' strike, which began last week, continued Monday at around 24 of Hostess' 36 plants.
Despite the company's tough talk, though, Hostess still needs to get permission to liquidate from Judge Robert Drain, who is overseeing its Chapter 11 restructuring. An interim hearing is scheduled for Monday afternoon and a final hearing is scheduled for Nov. 29.
