Hostess Brands, the producers of Twinkies, Devil Dogs and Wonder Bread is closing their doors after 82 years in business.
On Friday, the company made it clear that they will be asking a federal bankruptcy court for permission to close their operations due to a strike by their bakers who are protesting a new contract that was infringed on them.
Hostess’ closing will result in close to 18,500 workers becoming unemployed as 33 bakeries, 565 distribution centers, and 570 outlet stores will be shutting down.
The Bakery, Confectionery, Tobacco Workers and Grain Millers International Labor Union represent around 5,000 of Hostess employees.
“We deeply regret the necessity of today’s decision, but we do not have the financial resources to weather an extended nationwide strike,” said CEO Gregory Rayburn in a statement.
“The industry has overcapacity. We’re overcapacity. Our rivals are overcapacity,” added Rayburn.
Hostess plans to sell their assets to the highest bidder, which could mean their most popular products will be purchased at auction and added to products from other businesses.
On the company’s website, Rayburn posted a letter to employees that stated,” all employees would eventually lose their jobs, some sooner than others.”
“Many people have worked incredibly long and hard to keep this from happening, but now Hostess Brands has no other alternative than to begin the process of winding down and preparing for the sale of our iconic brands,” Rayburn’s letter read.
“As you know, for many months the Company has been working with our unions, lenders and other stakeholders to reach a consensual resolution to legacy costs and labor contracts. Despite everyone’s considerable efforts to move Hostess out of its restructuring, when we began implementing the Company’s last, best and final offer, the Bakers Union chose to stage a crippling strike.”