Bloomberg News

Hostess CEO Driscoll To Quit Bankrupt Twinkie-Maker

March 09, 2012

Brian Driscoll resigned as chief executive officer of bankrupt Hostess Brands Inc. (IBCIQ) and was replaced by Chief Restructuring Officer Gregory Rayburn.

Rayburn will oversee the company’s reorganization in bankruptcy, its business strategy, and negotiations with unions, Hostess said in a statement today. He has 29 years of experience working with troubled business, including New York City Off Track Betting Association and Sunterra Corp., and served as chief restructuring officer at WorldCom Inc.

“Hostess has been in business for more than 80 years and has established a powerful and valuable brand,” Rayburn said in the statement.

The maker of Twinkies snack cakes and Wonder bread filed for bankruptcy in January, less than three years after completing an earlier restructuring. The baker ended an earlier trip through bankruptcy court in February 2009 when buyout firm Ripplewood Holdings LLC and lenders took control of Interstate Bakeries Corp., which was renamed Hostess Brands (IBCIQ).

Hostess blamed the latest bankruptcy on a weak economy and costs tied to pension- and medical-benefit obligations. Hostess had total assets of about $982 million and liabilities of about $1.4 billion as of Dec. 10, according to court papers. The Chapter 11 case was assigned to U.S. Bankruptcy Judge Robert Drain in White Plains, New York.

Interstate Bakeries was created through the merger of Schulze Baking Co. and Western Bakeries Ltd. in 1937, and grew by acquiring other companies, according to court documents filed in the first bankruptcy case. It acquired its biggest rival, Continental Baking Co., in 1995 for $330 million, according to the company’s website.

The company’s products include Hostess CupCakes, Ding Dongs, Drake’s Devil Dogs and Nature’s Pride breads.

The case is In re Hostess Brands Inc., 12-22052, U.S. Bankruptcy Court, Southern District of New York (White Plains).

To contact the reporter on this story: Tiffany Kary in New York at tkary@bloomberg.net

To contact the editor responsible for this story: John Pickering at jpickering@bloomberg.net


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