IRVING, TX -- Hostess Brands, maker of Twinkies, Ho Hos and Ding Dongs snack cakes, filed for Chapter 11 bankruptcy protection today (Jan. 11).
The Irving, TX, baked goods giant attributed its need to reorganize on difficulties related to pension and medical benefits obligations, increasing competition and a tough economy. The news comes less than three years after the company's predecessor, Interstate Bakeries, completed an earlier restructuring.
In its filing with the U.S. Bankruptcy Court for the Southern District of New York, privately held Hostess Brands said that it owes more than $1 billion to creditors. The number of creditors is estimated to be between 50,0000 and 100,000, and pension funds feature prominently among them.
Hostess said a $75 million financing commitment from a group of lenders will allow the company to maintain routine operations and continue to offer its popular brands as it looks to restructure into a "strong, competitive" company.
Hostess was founded in 1930, has about 19,000 employees and operates in 49 states. Its subsidiaries include Interstate Brands Corp., the maker of Drake's Ring Dings and Yodels, and Dolly Madison Bakery, well known for its Zingers snack cakes. Hostess also owns bread bakers such as Wonder and Nature's Pride. Annual sales are about $2 billion, according to the company's website.