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the way the labor laws are written, if another buyer comes along that wants to be in the same business and use the equipment in the same manner at the same factories, the new owners will 'inherit' the union along with the business. The only way to successfully get rid of the union is to sell everything off individually and walk away and have the factories remain empty or be utilized in another industry.
Isn't that ridiculous?
It's like the workers have partial ownership without the investment. That's the worst thing about all of Obama's bailouts, protecting the Unions while shafting the investors. Now it's time for investors to give Obama the shaft, LOL!
I just saw a comment
on Fox about this and evidently any new owner that wants to take over the same business, if that owner already has his own bakers, he can bring them in without the union and keep the previous bakers laid off. From what I heard a deal was offered to all of the workers from Hostess and all of the workers except the bakers' union accepted the deal, so the bakers are the ones that put the final nail in everyone's coffin. Greed 'wins' out again........
How the unions killed off hostess
How many Twinkies have you killed? I've killed a few.
Don't care if i ever kill another one
your own link seems to split the blame
between the baker's union and the hedge funds.
Since distressed value funds, vulture funds, look for companies they think cheaper than the value, they normaly pay fractions of what the company should be worth to gain control. It's also quite common after this happens for companies to be sold off in pieces, both product rights and physical assests
I haven't seen the numbers yet on what the concession to benefits and pensions were and what the cost of both unions and management salaries and benefits are.
the hedge funds
They are losers too. Losing investment, but they would like to get something back from it before nothing is left. There's no winners in this, other than maybe the lawyers.
sure they lose
but they are professionals at assessing risk vs profit, at least supposely so.
This particular fund was known as one for buying companies currently under stress for less than their asset values.
I looked into it
and if a few years ago they might have come out ahead on selling off real estate in a climbing market, but there's not even that now. They will be losers. In fact, the smart move would be to find other commercial bakeries with union troubles and short their stock.
What's the brand name and recognition sell for you think?
So they still may profit, even closing the company
Do you realize how deep in the hole
these hedge funds are? When I looked there were 3 of them and one is basically broke from this, the other two still have some skin they can claim from it, but there is NO WAY they will get back their investment, and certainly not more than their investment.
Here's a good article on it.
You can have fun blaming the Democrats, LOL.
"....in 2007 Ripplewood acquired Reader's Digest -- and saw its $275 million investment vanish in Reader's Digest's bankruptcy filing in 2009. (Collins reportedly had visions of merging Reader's Digest with the magazine division of Time Warner (TWX), which owns Fortune.)
Tim Collins, CEO of Ripplewood Holdings
Ripplewood's foray into Hostess was partly enabled by Collins's
connections in the Democratic Party. He wanted to explore deals with
union-involved companies and sought the help of former congressman
Gephardt, who in 2005 founded the Gephardt Group, an Atlanta consulting
firm that provides "labor advisory services." In his 2004 presidential
bid, Gephardt -- whose father was a Teamsters milk truck driver -- was
endorsed by 21 of the largest U.S. labor unions; in 2003, Collins was
one of 19 "founding members" of Gephardt's New York State leadership
committee. (Today, Ripplewood and Hostess are listed online as major
clients of Gephardt's consulting group, which is also an equity owner of
Hostess.) Back when Hostess was coming out of the first bankruptcy,
Gephardt's credibility with both Ripplewood and the Teamsters gave them
each a little more room to break bread."
From that article
Since you seem so concerned funds might actually get some money back, and seem even worried they might come out ahead on this;
"Right now, according to sources with knowledge of Hostess's debt structure, Silver Point and Monarch each hold Hostess obligations with a market value of between $50 million and $100 million. Those sources also say each hedge fund probably paid somewhere between $125 million and $175 million for that debt. So even with losses to date, both hedge funds have ample skin in the game -- skin they'd like to get out of the game sooner rather than later"
There are no winners here.
I'm not saying that it's good the funds are losing money, that's not good for the economy in general.
It's just that so often these funds make money by buying a company, squeezing it, and then selling off the pieces. Your references indicate otherwise in this case, if that's all the facts. If so, the investors may have done a poor job of evaluating the company.
I've never said the baker's union was right to shut the company down, we know that wasn' the actual intent. I don't think even you would assign that motivation. The union misjudged too evidently as to what they could ask and the company still make money. I stated to begin with I didn't know enough to judge the sensibility of the strike.
The union's job isn't to bankrupt the owners, it's to protect it's workers from exploitation and to help make a decent living.
One statement said the cuts in benifits and rise in employee cost of health insurance the wages dropped to minimum wage. Of course, they still had health coverage. Depending on how good or bad the coverage was that's important today. I'd bet someone felt that the concessions asked of the unions was just to make it more lucrative for someone else, perhaps ridiculously so. It would seem that was a bad read.
A bad decision on both the investment firms when they evaluated the company and of the union as to the reality of the company finances I guess.
The difference is you believe workers are nothing but labor, biological machines, to be used and discarded at will with not a whit of consideration. Over and over you've made it clear to you labor, even skill labor, is just a tool, to be bought at the cheapest price, used up, and replace whenever it can be gotten cheaper, like buying all your goods made in China.
re deep in the hole further down
So one company invested so much of itself into one investment that this bankruptcy will bankrupt it? More than one questionable choice here then.
As far as not getting back more than their investment, if they do actually get back their original you might consider them lucky. They made a risk evaluation and the company failed, breaking even would be a break for them.
Now I realze next is the claim the business didn't make money only because of unreasonable greed by the baker's union. Even anyone that believes that's the only cause, shouldn't this type of risk assessment included an evaluation of how the union relations would likely affect futures, so that's part of the bet. I would think since this was not the first round of concession demands in the last few years that labor problems would have been expected. Probably that contributed to a fire sale price the investment company salivated over how much they were going to get out of this company's cash flow problems.
Don't know that's universal
as I understand it, that has to be in the contract. So if the contract has expired, that may not apply.
Of course that may be different a closed shop state vs an open shop or right to work state.
Jan 2012....Hostess Brands, the baker of Twinkie cakes and other iconic American foods, filed for bankruptcy protection today after failing to win concessions on union contracts.
Founded in 1930, Hostess owns brands that were emblematic of American food for generations. Its popular Twinkie, a snack cake with a creamy filling, was launched that year. The company claims its Wonder bread, a vitamin-enriched sliced bread, was the first 100% natural bread available across the US.
The privately held company filed a Chapter 11 bankruptcy reorganisation in a New York federal court, less than three years after emerging from a 2004 bankruptcy filing. "Hostess has some of our industry's most powerful and resilient brands," said Brian Driscoll, president and chief executive of the Texas-based firm.
2004?....Jan 2012?.....Oct 2012?
Michelle Obama doesn't look like she's eaten too many Twinkies...I wonder what she had do do with them going out of business.
We still have them up here...
Don't worry, they'll be gone soon enough
As for MO.......she must be eating something pretty rich herself, even with her war on food, because she's no lightweight like Nancy Reagan or Laura Bush. I'm suspecting she raids the fridge while sleepwalking.......
I hear Ya'
Michelle...Yeah...She's a real TUB.
I heard they had to reinforce the beds and chairs in the White House she's so heavy, and widen the doorways..
yeah...THAT'S what they had to do.
She's so pumped up
I heard they put in a sparring ring in the basement for her so she could keep that upper body build.
Good they'll have something to fall back on in 4 years
She can go on MMA and Barack can be her manager.
I remember Barbara Bush.
She was no lightweight, either.
She didn't try to control our food either
She also didn't have a sparring ring in the WH.
I CAN picture it though...Barb working out on a heavy bag.
you sound like a child.
The founding Fathers were not concerned about the Freedom to eat Garbage Food. Being resentful because someone is telling you to eat healthy food rather than candy and cake and soda pop is childish.
Telling me is one thing....
forcing it on me is another...........
Is it being forced on you or your kids, grandkids?
Perhaps it's saving the kids, grandkids FROM their relatives.
Unless the government
can bring charges against me for abuse or neglect, there is nothing to save them from.