Report: Hostess again prepping for bankruptcy
Jan. 10, 2012
by Eric Schroeder
IRVING, TEXAS — Hostess Brands, Inc., the maker of Wonder Bread and Twinkies, is preparing to once again file for Chapter 11 bankruptcy protection, according to The Wall Street Journal.
The announcement comes just a little more than four months after the WSJ reported that Hostess had hired restructuring advisers amid continued struggles with high ingredient, fuel and labor costs. At that time, the WSJ noted that no restructuring appeared imminent for Hostess, and adequate cash was said to be available to operate in the near term.
But in its most recent article, the WSJ, citing people familiar with the matter, said the company is facing a cash crunch with more than $860 million in debt, high labor expenses and rising ingredient costs.
Previously known as Interstate Bakeries Corp., Hostess filed for Chapter 11 bankruptcy protection in September 2004 before emerging in February 2009. At that time, the company announced it would operate as a private company, and in November 2009 I.B.C. changed its name to Hostess Brands, Inc.
Hostess Brands, which has not commented on the bankruptcy filing rumors, employs about 19,000 and operates in 49 states. Annual sales are about $2 billion.