Interstate Bakeries (Wonder Bread, Twinkies) offers part ownership to unions

[Omaha Steve]

http://www.kansascity.com/business/story/867742.html


Justin Sullivan
If creditors approve Interstate Bakeries’ reorganization plan and the court resolves any outstanding issues, the wholesale baker could be out of bankruptcy by the end of the year.

By ERIC PALMER
The Kansas City Star

The two most contentious parties in the long-running bankruptcy of Interstate Bakeries Corp. have decided it’s better to make up than to break up.

If the peace accord is approved, organized labor could end up owning a slice of one of the nation’s largest bakers.

During more than four years in bankruptcy, the International Brotherhood of Teamsters, whose members sell and deliver Interstate’s Wonder bread and Hostess Twinkies, has been the most vocal critic of Interstate’s restructuring proposals. Officials once said the union would rather see the company go out of business than to work with its current management.

The Teamsters, Interstate’s largest union, a year ago went so far as to break off communication with the wholesale baker in a fight over additional concessions Interstate wanted.

Instead, it decided to negotiate contract changes directly with Ripplewood Holdings, the company that has agreed to buy Interstate out of bankruptcy.

But a revised reorganization plan filed in court Thursday by Interstate proposes that the employees of its four largest unions get an ownership stake in the reorganized company, assuming it grows, in exchange for agreeing to additional concessions.

The “employee equity sharing plan,” while not described in detail, would give most union employees “stock appreciation rights” similar to those being made available to executives like CEO Craig Jung, whom the union earlier vilified.

FULL story at link.

[Submariner]

1. Long live Deep-Fried Twinkies

DU'ers of planet earth. We cannot, I repeat, CANNOT, let the Twinkies manufacturer go into bankruptcy. As one of the major food groups, we need to ensure the survival of the Twinkie.

Now for a late night treat.

[On the Road]

2. I Like the Concept

A lot of corporations have partial employee ownership though retirement matching, but the employees have no organized voice. A union will do that. It gives management and labor a common goal of creating a successful company. Unions will be tougher on their own members when they own part of the company.