Consumers Bid Farewell to Twinkies, HoHos, and Ding Dongs For Now

Consumers Bid Farewell to Twinkies, HoHos, and Ding Dongs For NowAccording to the Chicago Tribune, Hostess Brands, the iconic company responsible for childhood favorites such as Twinkies, Honey Buns, and Wonder Bread, announced Friday that it was calling it quits. While it has been in bankruptcy proceedings for at least five out of the last eight years, Hostess now claims that it cannot weather a recent labor strike by union members, and is requesting permission to shut down operations altogether. This would mean layoffs of approximately 18,500 workers at 33 plants nationwide, including about 300 workers in the Chicago area, in bakeries located in Schiller Park and Hodgkins.

When a large company ceases operations under the supervision of the bankruptcy court, it is typically required to liquidate as many assets as possible so as to satisfy as many of its creditor claims as possible. In the case of Hostess, its most valuable assets, by far, are the name brands of its products that are likely to be sold to competing companies at large profits. These profits, in turn, will be used by the bankruptcy court to pay off debts owed by Hostess, in order of their priority under bankruptcy law.

While many consumers are rushing to store shelves to scoop up the remaining Hostess products, industry experts are weighing in on the likelihood and the timing of the Twinkie comeback, as well as the other Hostess brands. Rumors are already swirling as to which companies might be clamoring to purchase household names such as Honey Buns and HoHos.

Whatever the outcome of this particular situation may be, companies who are successful in purchasing Hostess brands will do so pursuant to carefully drafted written contracts that set forth all major aspects of the sale, including the purchase price, the extent to which ownership of the brand name is transferred, and the effective date of the ownership transfer. These legal documents are essential in legally and safely transferring property in a way that protects all parties to the agreement.

If you are considering purchasing an asset from a company who has ceased operations or otherwise gone out of business, you will need the assistance of a skilled Oak Brook business attorney in order to ensure that your interests are protected and your goals are met.