Sounds like wonder bread maybe going out of business. If they hold true to their previous threats (a couple weeks back).
Interstate Bakeries Corp. today said it has not been able to reach agreement with the Teamsters union after reaching agreement Friday with its other main union.
On Friday, the bankrupt maker of Twinkies and Wonder bread said it had reached agreement on contract modifications with the Bakery, Confectionery, Tobacco Workers and Grain Millers International Union.
Interstate said the bakers’ union had begun having its members vote to ratify the changes, which included health and welfare concessions and changes to the company’s distribution network.
In a release this morning, IBC said it has not been able to reach agreement with the International Brotherhood of Teamsters on modifications to its collective bargaining agreements necessary to allow a more capable and cost-effective path-to-market, specific health and welfare concessions, and increased work rule flexibility.
IBC previously said that if it didn’t have agreements with its two principal labor unions by a self-imposed Sunday deadline it would seek interim Bankruptcy Court approval for a 30-day extension to consider its options, including a liquidation of the company. A hearing is set for Wednesday.
IBC today said it remains open to discussions with the Teamsters leading up to the hearing.
IBC also said that it is continuing discussions with prospective investors to secure the financial resources required to successfully emerge from bankruptcy and implement its business plan, but that all financing proposals it has received to date require union alignment to the company’s business plan.
If union and financing arrangements are not achieved Wednesday, however, IBC said it will pursue court approval of the extension and focus efforts on alternative plans to maximize the value of the bankruptcy estates.
The Teamsters, which represents around 10,000 employees, object to additional health care concessions, as well as the company’s plan to separate the job functions of many drivers who currently sell and deliver the company’s products.
The union says the distribution changes would reduce the pay for many of its members, but Interstate Bakeries said the effect would be smaller than the union is claiming.
The Teamsters last week asked the bankruptcy court to deny Interstate Bakeries’ request for more time, saying three years has been more than enough to work out a plan.
JP Morgan Chase Bank, which represents the company’s pre-bankruptcy lenders, made a similar request this week, saying the deadline should be pushed back no further than Oct. 31.
A committee of unsecured creditors has also filed motions, seeking to force Interstate Bakeries to talk with potential buyers and allow creditors to be part of those negotiations.
The Star and The Associated Press
In a previous article Interstate has said that if they liquidate, they would not consider offers from two companies that has expressed interest in the company. Those two companies are Yucaipa, an investment company headed by Ron Burkle of Los Angeles, an equity firm affiliated with J.P. Morgan, the bank representing it's creditors. To me, they are in bankruptcy, and are in no position to say who will buy them. That will be up to the judge and no one else.
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