Plans for a Hostess bankruptcy in 2012 may be premature as a federal court puts a hold on Hostess closing its plants. Judge Robert Drain ruled yesterday, blocking Hostess Brands from beginning liquidation and ordering management of the White Plains company and the unions back to the negotiating table. Much has been made recently about CEO Gregory Rayburn getting a huge raise earlier this year as the makers of Twinkies, Ding Dongs, and Ho Hos battles with the Bakery, Confectionery, Tobacco Workers and Grain Millers International Union. Hostess cupcakes and Wonder Bread would still be flowing into stores as other unions, such as the Teamsters, had already agreed to concessions. So is this latest move merely prolonging the agony?
It should come as no surprise that a New York bankruptcy court would back up a union. In the Age of Obama, unions get all the breaks. But the bottom line is that in the highly competitive, and shrinking snack food market, Hostess simply cannot function as it once had. Shelf space at stores is becoming a premium, with newer, healthier snacks getting more exposure. Add to that the ridiculous regulations in many communities, forbidding trucks to deliver both bread and snack cake products. The costs of labor and logistics is driving Hostess right out of the market.
Yet, people want their Twinkies! Even Bob Beckel, noted Liberal Democrat pundit, is upset at the unions for the demise of Hostess. His rant on Friday′s episode of ″The Five″ on Fox News was hilarious as he stuffed his mouth with Twinkies. Monday was even better after co-host Greg Gutfeld made a Twinkie shake using four Twinkies and what looked to be perhaps 3 to 4 cups of milk in a blender. The other hosts just took a sip of the shake for a taste, but Bob Beckel downed a whole large glass himself in a single tip. In doing so, Beckel began uncontrollable belching and other bodily functions, forcing him to exit the stage before the final segment!
So there you have why a Hostess bankruptcy in 2012 would be a horrible mistake for all fans of Twinkies, Ding Dongs, Ho-Hos, cupcakes and Wonder Bread. The proposed Hostess closing was put on hold yesterday by Judge Robert Drain in federal court. The fight between the White Plains company and the Bakery, Confectionery, Tobacco Workers and Grain Millers International Union will go back to the negotiating table. CEO Gregory Rayburn of Hostess Brands is getting heat for pay raises he and other executives received earlier this year. But will any amount of external pressure save Hostess at this point?