11-30-2012, 12:49 AM
Update in today's business news:
Snipped:
The company said in court that it's in talks with 110 potential buyers for its brands, which include CupCakes, Ding Dongs and Ho Hos. The suitors include at least five national retailers such as supermarkets, a financial adviser for Hostess said. The process has been "so fast and furious" Hostess wasn't able to make its planned calls to potential buyers, said Joshua Scherer of Perella Weinberg Partners.
"Not only are these buyers serious, but they are expecting to spend substantial sums," he said, noting that six of them had hired investment banks to help in the process.
The update on the sale process came as Hostess also received approval to give its top executives bonuses totaling up to $1.8 million for meeting certain budget goals during the liquidation. The company says the incentive pay is needed to retain the 19 corporate officers and "high-level managers" for the wind down process, which could take about a year.
Although Hostess was able to reach a new contract agreement with its largest union, the Teamsters, the bakers union rejected the terms and went on strike Nov. 9. Hostess announced its plans to liquidate a week later, saying the strike crippled its ability to maintain normal production.
In court Thursday, an attorney for Hostess noted that the company is no longer able to pay retiree benefits, which come to about $1.1 million a month. Hostess stopped contributing to its union pension plans more than a year ago.
Full story:
http://t.money.msn.com/business-news/new...d=15844759
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Wonder and Devil Dogs are amongst the potential buyers.
I believe that I'm in the minority here at Mock, but this case demonstrates why I support outsourcing as a necessity for some American companies to continue to exist. Imo, outsourcing is preferable to dissolution for many reasons that benefit the US economy. Not a lot of companies could garner so much interest as Hostess from potential American buyers at this stage (analysts attribute the interest, in part, to "nostalgia" over the products).
The Bakers Union's demands and Hostess's inability to meet them and remain profitable are examples of the challenges faced by large American business owners and enterprises, particularly in manufacturing/production operations. However, it appears very clear that continuous organizational mismanagement contributed significantly to Hostess's liquidation as well.
We need cross the board business tax reforms and also to take a good hard look at which/whether labor unions are required today. If we (America, collectively) can't bridge the gap between their goals and those of management, American companies will rightly continue to outsource labor in order to stay afloat and/or realize a decent profit margin. All JMO...
Snipped:
The company said in court that it's in talks with 110 potential buyers for its brands, which include CupCakes, Ding Dongs and Ho Hos. The suitors include at least five national retailers such as supermarkets, a financial adviser for Hostess said. The process has been "so fast and furious" Hostess wasn't able to make its planned calls to potential buyers, said Joshua Scherer of Perella Weinberg Partners.
"Not only are these buyers serious, but they are expecting to spend substantial sums," he said, noting that six of them had hired investment banks to help in the process.
The update on the sale process came as Hostess also received approval to give its top executives bonuses totaling up to $1.8 million for meeting certain budget goals during the liquidation. The company says the incentive pay is needed to retain the 19 corporate officers and "high-level managers" for the wind down process, which could take about a year.
Although Hostess was able to reach a new contract agreement with its largest union, the Teamsters, the bakers union rejected the terms and went on strike Nov. 9. Hostess announced its plans to liquidate a week later, saying the strike crippled its ability to maintain normal production.
In court Thursday, an attorney for Hostess noted that the company is no longer able to pay retiree benefits, which come to about $1.1 million a month. Hostess stopped contributing to its union pension plans more than a year ago.
Full story:
http://t.money.msn.com/business-news/new...d=15844759
============================
Wonder and Devil Dogs are amongst the potential buyers.
I believe that I'm in the minority here at Mock, but this case demonstrates why I support outsourcing as a necessity for some American companies to continue to exist. Imo, outsourcing is preferable to dissolution for many reasons that benefit the US economy. Not a lot of companies could garner so much interest as Hostess from potential American buyers at this stage (analysts attribute the interest, in part, to "nostalgia" over the products).
The Bakers Union's demands and Hostess's inability to meet them and remain profitable are examples of the challenges faced by large American business owners and enterprises, particularly in manufacturing/production operations. However, it appears very clear that continuous organizational mismanagement contributed significantly to Hostess's liquidation as well.
We need cross the board business tax reforms and also to take a good hard look at which/whether labor unions are required today. If we (America, collectively) can't bridge the gap between their goals and those of management, American companies will rightly continue to outsource labor in order to stay afloat and/or realize a decent profit margin. All JMO...