Wal-Mart wants to save the Twinkie
The retailing giant is one of several bidders reportedly interested in purchasing parts of Hostess Brands.
According to Bloomberg News, the largest retailer is making a run for the assets of Hostess Brands, the bankrupt maker of Twinkies, Sno-Balls and Wonder Bread. Other bidders include grocery chain Kroger Co. (KR) and Grupo Bimbo, the Mexican conglomerate whose brands include Entenmanns's baked goods and Thomas' English muffins. Some of the bids are for all the company's assets and others are for lines of business and individual products, the news service said.
The interest is a sign that Hostess, which has begun to liquidate its assets after unionized workers balked at agreeing to additional concessions, will live to fight another day in some form or another.
The 18,000 Hostess employees who lost their job shouldn't rejoice quite yet. Any new owner of Hostess or its businesses will not be bound by any agreements that prior management made with the unions. A new buyer may demand wage concessions as steep, if not steeper, than the ones demanded by the current owners. Sadly, the $1.8 million that the bankruptcy court approved as retention bonuses for top executives will be paid no matter what.
Members of the Bakery, Confectionery, Tobacco Workers and Grain Millers Union say they are not to blame for the company's demise. Its website argues that its members dedicated their working lives to their work and had to "watch helplessly as the company was run into the ground, over and over again." Ironically, I attended a conference on corporate restructuring a few years ago where Hostess was touted as a success story.
Even if Hostess had the best labor relations in the world, the company would face a tough road ahead. For one thing, the costs for ingredients have skyrocketed this year as U.S. crops withered following the worst drought in more than five decades. America's dietary habits have also changed in the wake of soaring rates of obesity.
Take Twinkies. When I grew up in the 1970s and 80s, parents would think nothing of putting the creme-filled spongecake in a kid's school lunch. Today's parents would think twice before letting their children eat something so unhealthy.
Hostess products such as Twinkies are like newspapers. People like them in theory, but can't remember the last time they bought one. That needs to change if Hostess hopes to survive.
--Jonathan Berr does not own shares of the listed stocks. Follow him on Twitter @jdberr
I don't give a damn who makes them as long as they make them right.
they haven't tasted good in 25 years since the started making them politically correct.
Make them taste like 1960. wal mart ****s up every thing it touches...let little debbie make them.
As to why the bonuses during bankruptcy, that is decided by the owners representatives which are the board of directors and stockholders which include the CEO and of course the bankruptcy judge................ the unions had gotten their pay and bonuses according to a CONTRACT which was forced on ownership ... and then wanted more ........... they got their just deserts, now a good reason to reorganize with far less labor and more machines .......... machines are always better than the usual unskilled labor, no sick days, no hangovers, no maternity /paternity leave, no bad attitudes, no unions, no vacations, no HR dept, no suits, no workman's comp, no healthcare, less bookkeeping and payroll dept .... and on and on.
The real tearjerker is that unskilled humans haven't faced the fact that they are infinitely replaceable, and that stupidity is WHY they are replaceable!
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