Hostess bankruptcy judge OKs motion to wind down company
WHITE PLAINS, N.Y. - Hostess Brands won interim approval from a bankruptcy judge to shut down and take steps to sell the Twinkie maker's assets after mediation with its bakers' union failed to resolve a contract dispute, leaving more than 18,000 jobs at risk.
U.S. Bankruptcy Judge Robert Drain on Wednesday approved Hostess's request to close at a hearing in White Plains, N.Y.
Chief Executive Officer Gregory Rayburn said 15,000 workers were to be fired Wednesday so they can start receiving unemployment benefits. On Friday, Hostess said it needed to liquidate because a weeklong strike by its bakers' union crippled operations.
Hostess officials and union representatives met Tuesday in mediation that Drain requested Monday in a last-ditch effort to negotiate contract terms that might keep the floundering company afloat. Hostess said Tuesday night that the talks failed.
Drain will consider final approval of the wind-down request at a hearing next Thursday.