Recent reports say that Hostess Brands Inc. and a Bakery Union have agreed upon mediation instead of liquidation in order to prevent the brand from shutting down.
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According to Bankruptcy Judge Robert Drain, mediation is a better option to save the iconic Hostess brand, which produces Twinkies and Wonder Bread, rather than accommodating its original request to sell the company’s assets and liquidate. The decision was made this afternoon at the U.S. Bankruptcy Court in White Plains, N.Y. As a result, there is more hope of preventing over 18,000 workers from losing their jobs.
Last week, Hostess was forced to close down their factories and declared that they would not be able to recover from a nationwide workers strike. Hostess met the Bakery, Confectionery, Tobacco Workers and Grain Millers International union in court today to discuss their next steps.
“To me not to have gone through that step leaves a huge question mark over this case, which I think–I may be wrong–but I think will only be answered in litigation. And that’s no one’s desired outcome,” the judge said.
He acknowledged the economic struggle that Hostess is suffering due to the strike, but continued to offer to preside over the case as a mediator.
“Moving to a liquidation is also a significant economic hit, and I think that many people, myself included, have serious questions as to the logic behind the decision to strike and a concern that it may be as a result of differences as far as information and goals,” the judge said. Such differences “might be better worked out with a neutral third party in private as opposed to raising these issues in public.”
We’re glad there’s hope for us snack lovers after all!
