As reported by the Wall Street Journal on January 9, 2012, Hostess Brands, Inc., is planning to seek protection under Chapter 11 of the Bankruptcy Code to restructure its company. Hostess Brands, Inc., is the baker of the legendary Twinkie snack cake. Could the good food police have finally brought down one of the poster children for unhealthy eating? Hopefully not.
The Journal further reported that the bankruptcy is being dubbed as a "Chapter 22" as Hostess Brands, Inc. had previously filed a Chapter 11 plan back in 2004. It came out of Bankruptcy in 2009 but continued to face economic challenges in this new economy. It was reported that Twinkie sales were down by 2% in its last fiscal year.
The goal for the privately owned company is to reduce its debt and renegotiate contracts with its unions. The filing is an indication of how broad the economic downturn is, and it is not limited to only housing and banking, but businesses as diverse as airlines and the food industry. If Hostess can not get a Plan approved by its creditors, it could face a sale or, a worse case scenario, liquidation, which could mean the end of a childhood memory for many, many people. However, on a serious note, the filing affects many employees and their families, so hopefully Hostess can come out stronger than after its last filling and continue to produce childhood memories and save the jobs of its employees.
Do you have childhood memories of Twinkies or Ho Ho's or some other favorite indulgence? Share it below.
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