Hostess Brands announced that the company will close, primarily because of labor issues. In a statement, the company blames a union strike for dooming the maker of beloved Ho Ho's, Ding Dongs, Sno Balls, and Twinkies.
"Hostess Brands is unprofitable under its current cost structure, much of which is determined by union wages and pension costs. The offer to the BCTGM included wage, benefit and work rule concessions but also gave Hostess Brands' 12 unions a 25 percent ownership stake in the company, representation on its Board of Directors and $100 million in reorganized Hostess Brands' debt."
Although Hostess' 18,500 employees, understandably, are upset with the decision, some say the pay cuts were intolerable: "The point is the jobs they're offering us aren't worth saving."
Critics of the decision also cite post-bankruptcy-filing executive pay increases between 75 and 85%.