LOS ANGELES (LALATE) – Twinkies may survive, but not labor jobs. Twinkies will survive as Hostess sells off its assets starting this week, insiders tell news. And while Con Agra and Flowers Foods are interested buyers, El Grupo Bimbo could end up buying Hostess and moving jobs to Mexico.
El Grupo Bimbo, owned by Daniel Servitje Montull, has expressed an interest. El Grupo Bimbo could make a bigger profit on the product, not just because of lower labor costs, but also because of sugar tariffs. Insiders tell news that Hostess suffered big hits in recent years because of the cost to import sugar into the U.S. That would be different if the product is made in Mexico.
Frank Hurt, president of the Bakery, Confectionery, Tobacco Workers and Grain Millers Union said this weekend that there is “more than a good chance” that his union workers will get their jobs back. That’s not true, says insiders. Hostess claims that the labor union’s demands pushed the company into bankruptcy. Hostess asserts that, once the sale is effectuated, those employees won’t be getting their jobs back. Nearly twenty thousand jobs will be lost while five hundred bakery stores and thirty-three factories will be shut down.
And Bimbo could be the big winner. Forbes reports that years earlier Bimbo made a below market bid for the company of $580 million which was rejected. An offer today could be accepted as low as $135 million. The company makes $2.5 billion in revenue per year, and Twinkies this year have generated $68 million so far.
“I think we’ll find buyers,” CEO Gregory F. Rayburn said to ABC. “A few have surfaced already since Friday expressing interest in the brand to acquire them.”
El Grupo Bimbo, Twinkies