Hostess Tries To Lengthen Shelf Life .Host survival Brands Inc. 's may depend on the outcome of negotiations with its two main unions, as the maker of Twinkies and Wonder Bread is preparing to file for bankruptcy a second time, said people familiar with the matter. The presentation is expected to be less than three years after Hostess emerged from a previous season in Chapter 11.
Host Board deliberated Tuesday night and prepared to authorize a bankruptcy filing for as soon as Wednesday, one of those people, he said.
Problems of the company followed a buying spree for decades that left the company 82 years of age, carry a mixture of union contracts and complex distribution systems.
Host plans to file court papers soon, after entering the bankruptcy court threaten to reject or amend his employment contract 372, one of the people, he said, a joint effort by companies seeking to leverage to get labor concessions. His intention is to ask workers to make dramatic changes in everything from work rules for health benefits and how the company pays the pension obligations, said people familiar with the matter.
Brian Driscoll, President and CEO Mark hostess was hopeful that the company is able to "modify our employment contracts so that we can create a sustainable cost structure." Over 80% of its 19,000 employees belong to a dozen independent unions.
The representatives of two major unions in the host, the International Brotherhood of Teamsters and the Bakery and Confectionery Workers, and Grain Millers International Snuff Union, declined to comment.
Host has a wealth of complex labor standards that the company deems ineffective, the people said. In some cases, work rules mandate that trucks must separately deliver bread and cake products, these people said. Sometimes, self-employed, you must load the trucks and make deliveries more workers must end once a truck arrives at a supermarket, they said.
Housewife, she owes creditors more than $ 860 million and has struggled since emerging from bankruptcy proceedings in February 2009, tried to find a white knight who would buy the company directly or have individual businesses along the years without any result, the people said.
The closed Irving, Texas, the company sold the brand of sugar Mrs. Cubbison Foods Corp. for $ 12 million last year, but could not find buyers for some of its other businesses. Prospective buyers ranging from Kraft Foods Inc. for the business of Campbell Soup Co.’s Pepperidge Farm and private equity firms Blackstone Group LP and KKR & Co. bankers were contacted by the owner of the house sometime during the last two years, but the disclosure does not raise the bids.
The representatives of Kraft, Blackstone and KKR declined to comment. A spokesman for the Campbell Soup declined to comment.
The bread business has been consolidating in recent decades, and only three major players, as well as host on the left are the industry leader Grupo Bimbo SA, the No. 2 strong players, Flowers Foods Inc., and Pepperidge Farm. Competition issues are likely to prevent those companies from the acquisition of flight attendants, and "I cannot think of any company, not the bakery business, now that he wants to enter," says Janney Montgomery Scott analyst Mitchell Pinheiro . "Nobody will buy Hostess as a whole. That's the problem."
Following the recession, the company's financial performance has deteriorated, with increasing losses of more than $ 340 million in about $ 2.5 billion in sales in its most recent fiscal year, said a person familiar with the matter. The person said that the results have not yet been finalized.
Twinkie brush with traces of death to the aspirations of the company to become the dominant supplier of U.S. snack and bakery products in the supermarket aisle. It began as host of other sodium Co. in Kansas City, Missouri, in 1930 and grew by swallowing other companies over the years 1960 and 1970.
But with each wine purchased bakery pension obligations and a number of different employment contracts have had problems reconciling. Housewife, for example, pays about $ 100 million a year to about 40 pension plans that cover multiple employers of workers in a wide range of companies other than their own, said people familiar with the matter. Host wants to change to a single employer plan that covers only call their own workers.
In general, hosts exploded in recent years in a company that currently operates 565 distribution centers, 570 bakeries and 5,500 delivery routes, sources said.
Opponents of the host, such as food Flores, are not unionized workforce for the most part, allowing them to reap significant savings in an industry where margins are very narrow, the people said.
These challenges helped the company land in bankruptcy, for the first time in 2004, and shareholder lawsuits, labor disputes and changes of direction remained there for four years. When the company emerged from bankruptcy, bought by private equity firm Ripple wood Holdings, the problems did not disappear.
"The fundamental flaw is those hostesses are burdened by this distribution network unionized. They need to combine routes, but drivers who lose their jobs and the unions do not like that," says Pinheiro.
In addition to labor and delivery problems, the company was slow to address the interests of consumers’ increasingly healthier products. Host, famous for its bread Wonder, came up with the pride of Nature, a small line of whole grain bread that was eclipsed in grocery stores, by the very nature of food from larger rival Flores. As consumers migrate to products that contain health claims, Twinkies, Ding Dong Ho Hos seemed relics of the past.
Host Board deliberated Tuesday night and prepared to authorize a bankruptcy filing for as soon as Wednesday, one of those people, he said.
Problems of the company followed a buying spree for decades that left the company 82 years of age, carry a mixture of union contracts and complex distribution systems.
Host plans to file court papers soon, after entering the bankruptcy court threaten to reject or amend his employment contract 372, one of the people, he said, a joint effort by companies seeking to leverage to get labor concessions. His intention is to ask workers to make dramatic changes in everything from work rules for health benefits and how the company pays the pension obligations, said people familiar with the matter.
Brian Driscoll, President and CEO Mark hostess was hopeful that the company is able to "modify our employment contracts so that we can create a sustainable cost structure." Over 80% of its 19,000 employees belong to a dozen independent unions.
The representatives of two major unions in the host, the International Brotherhood of Teamsters and the Bakery and Confectionery Workers, and Grain Millers International Snuff Union, declined to comment.
Host has a wealth of complex labor standards that the company deems ineffective, the people said. In some cases, work rules mandate that trucks must separately deliver bread and cake products, these people said. Sometimes, self-employed, you must load the trucks and make deliveries more workers must end once a truck arrives at a supermarket, they said.
Housewife, she owes creditors more than $ 860 million and has struggled since emerging from bankruptcy proceedings in February 2009, tried to find a white knight who would buy the company directly or have individual businesses along the years without any result, the people said.
The closed Irving, Texas, the company sold the brand of sugar Mrs. Cubbison Foods Corp. for $ 12 million last year, but could not find buyers for some of its other businesses. Prospective buyers ranging from Kraft Foods Inc. for the business of Campbell Soup Co.’s Pepperidge Farm and private equity firms Blackstone Group LP and KKR & Co. bankers were contacted by the owner of the house sometime during the last two years, but the disclosure does not raise the bids.
The representatives of Kraft, Blackstone and KKR declined to comment. A spokesman for the Campbell Soup declined to comment.
The bread business has been consolidating in recent decades, and only three major players, as well as host on the left are the industry leader Grupo Bimbo SA, the No. 2 strong players, Flowers Foods Inc., and Pepperidge Farm. Competition issues are likely to prevent those companies from the acquisition of flight attendants, and "I cannot think of any company, not the bakery business, now that he wants to enter," says Janney Montgomery Scott analyst Mitchell Pinheiro . "Nobody will buy Hostess as a whole. That's the problem."
Following the recession, the company's financial performance has deteriorated, with increasing losses of more than $ 340 million in about $ 2.5 billion in sales in its most recent fiscal year, said a person familiar with the matter. The person said that the results have not yet been finalized.
Twinkie brush with traces of death to the aspirations of the company to become the dominant supplier of U.S. snack and bakery products in the supermarket aisle. It began as host of other sodium Co. in Kansas City, Missouri, in 1930 and grew by swallowing other companies over the years 1960 and 1970.
But with each wine purchased bakery pension obligations and a number of different employment contracts have had problems reconciling. Housewife, for example, pays about $ 100 million a year to about 40 pension plans that cover multiple employers of workers in a wide range of companies other than their own, said people familiar with the matter. Host wants to change to a single employer plan that covers only call their own workers.
In general, hosts exploded in recent years in a company that currently operates 565 distribution centers, 570 bakeries and 5,500 delivery routes, sources said.
Opponents of the host, such as food Flores, are not unionized workforce for the most part, allowing them to reap significant savings in an industry where margins are very narrow, the people said.
These challenges helped the company land in bankruptcy, for the first time in 2004, and shareholder lawsuits, labor disputes and changes of direction remained there for four years. When the company emerged from bankruptcy, bought by private equity firm Ripple wood Holdings, the problems did not disappear.
"The fundamental flaw is those hostesses are burdened by this distribution network unionized. They need to combine routes, but drivers who lose their jobs and the unions do not like that," says Pinheiro.
In addition to labor and delivery problems, the company was slow to address the interests of consumers’ increasingly healthier products. Host, famous for its bread Wonder, came up with the pride of Nature, a small line of whole grain bread that was eclipsed in grocery stores, by the very nature of food from larger rival Flores. As consumers migrate to products that contain health claims, Twinkies, Ding Dong Ho Hos seemed relics of the past.
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