Interstate Bakeries plans to close four plants, cut 1,300 jobs

[Omaha Steve]

http://www.kansascity.com/business/companies/story/251515.html

Posted on Tue, Aug. 28, 2007 10:15 PM

By JENNIFER MANN
The Kansas City Star

Interstate Bakeries Corp. is shuttering four Southern California bakeries and eliminating 1,300 jobs because of high costs, weak pricing and a confrontational relationship with one of its unions, the company said.

But in announcing that it would quit selling bread in Southern California, the company, which has been in bankruptcy for nearly three years, sounded an alarm.

The Kansas City-based baking company and maker of Hostess and Wonder brands said Tuesday that its lenders and creditors were losing patience with its inability to get a buy-in for its business plan from unions and ultimately emerge from bankruptcy. It said that cooperation and concessions from its unions were crucial to its survival and that the buy-in needed to come soon.

“We have weeks, not months or years, to act,” said chief executive Craig Jung. He said that union agreement to its plans to revamp its delivery system and health and welfare were crucial.

A top official with the International Brotherhood of Teamsters, which represents 30 percent of the company’s 25,000 employees, reacted quickly to Tuesday’s news, saying the company had made no attempt to work with the union to find a solution in California.

“I don’t know if this was a move on (Jung’s) part to send a message, that ‘we’re going to rule with a big stick,’ ” said Richard Volpe, international director of the Teamsters.

FULL story at link.

Interstate Bakeries closed down in Omaha years ago.