The Deseret News is reporting today that Hostess may be forced to close its doors at its factory location in Ogden. Due to a dispute between the Bakery, Confectionery, Tobacco Workers and Grain Millers International Union and company officials, the company may be forced to liquidate the entire company through bankruptcy. It is estimated that if a deal is not reached, over 600 workers in Ogden will lose their jobs.
I have had several clients and friends who have worked for Hostess, some for over 20 years. The idea of losing their jobs is terrifying. If Hostess shuts down and sells off its eight brands and 36 factories, it could result in the loss of nearly 18,000 jobs nationwide. Liquidation would affect more than just the iconic snacks we typically think of like Twinkies, Ding Dongs and Zingers. Hostess has eight brands including Wonder Bread, Natures Pride, Home Pride and Dolly.
Hostess is currently going through a Chapter 11 bankruptcy reorganization in New York. This is the second time in three years that Hostess has filed for bankruptcy- but it is still having insolvency issues.
One of the main benefits of Chapter 11 bankruptcy is the ability for a company to reorganize and restructure its debt so that it may remain profitable for shareholders and employees. Chapter 11- or more likely, Chapter 13 can be a great tool for individuals and businesses to get their financial house in order.