Twinkie maker Hostess to close down, sell brands

Associated Press Modified: November 21, 2012 at 6:00 pm •  Published: November 21, 2012
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"This is a very hostile situation and in some respects rightfully so," Rayburn said.

A banker working for Hostess said at Wednesday's hearing that brands typically fetch the equivalent of about a year's sales when they are sold off in liquidation. He noted Hostess' sales are in the range of $2.3 billion to $2.4 billion a year.

The banker, Joshua Scherer of Perella Weinberg Partners, said that interest in Hostess' brands has come from companies ranging from regional bakers to major national retailers that have long sold Hostess products.

"This is a once-in-a-lifetime opportunity to get iconic brands separate from their legacy operators," Scherer said during the hearing in U.S. Bankruptcy Court in the Southern District of New York in White Plains, N.Y.

The company's initial announcement on Friday that it would move to liquidate its business prompted people across the U.S. to rush to stores and stock up on their favorite Hostess treats. Many businesses reported selling out of Twinkies within hours and the spongy yellow cakes turned up for sale online for hundreds of dollars.

Hostess, founded in 1930, filed for Chapter 11 bankruptcy protection in January for the second time in less than a decade. Its predecessor company, Interstate Bakeries, sought bankruptcy protection in 2004 and changed its name to Hostess after emerging in 2009.

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