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Hostess CEO Greg Rayburn on bids for the business and why the company ultimately shut down.
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410.
Million dollars to save the twinkie.
That's the opening bid coming from two big investment firms how high though could debating -- Greg Rayburn CEO of hostess brands.
Joins us now thanks for being with us -- -- so we got 390 million dollar -- and for the main bread business.
410 million with this new bid from metropolis in this in the in the other guy Apollo for the sweet cakes business.
But that's just because because now they -- they actually coming from more bidding do you think new guide you haven't heard from or who haven't made a bid will come in and try to top those prices.
I think we'll see news new bidders are not new people but people who have been participating in the process -- to at some point determined that they would rather be at the auction then then participate as a stalking horse so I think that's particularly going to be true on the -- side.
The business because the interest has been so intense the interest been so intense -- about four -- ten million if you go up by another 1520%.
-- I sure hope so -- and I think you know where we are today if you take all of the transactions now that we've generated over the past couple of months.
We're at 858 million dollars.
Total.
Floor price you've raised okay we probably have another.
Say 8223.
Million dollars worth of idle plants equipment and other things that will need to sell that will add to that right and then from there it's really a function of who comes and bids and where to the -- ago.
To determine sort of what the ultimate recoveries will be the -- And that target your -- and for Greg is 980.
Million dollars -- secured debt your company get that back for the debt holders who basically.
-- -- you into the company try to fix it and here's a thing if there is so much interest in twinkies.
Why wasn't -- enough interest to keep the brand alive why did post this end up shutting down the company.
Well you know I think if you go back and look at sort of how things played out.
The death knell for the business was the strike by the bakers union we could we could not overcome that strike.
I was unsuccessful -- -- convincing them to have to come back to work or get enough people across those picket lines for us to stay in business and we simply didn't have.
The liquidity -- the financial resources to weather a strike like that we were pretty clear that that would be the outcome you -- want all along that you would shut this company down if you did not get the concessions needed.
Do you think the baker thought you were.
-- You know I I.
I have no clue what what they're thinking I mean maybe maybe some -- maybe some thought there was a fire that was gonna swoop in and take the company hasn't existed at that time which we said there really wasn't that.
Maybe there's some belief that it had a fantasy play -- -- Wall Street Journal couple days in a row and it's the Bible of American business.
It has had this line quote post is moved to liquidate after it failed to reach a deal on cost cuts when it's the second largest.
Union ripping the -- is that what happened Greg did you fail.
Or did the union -- well look I when you have a result like this there's probably plenty of failure for everyone to own and -- but as I said before that that the death blow to this company was the -- strike and that's really what put this company and liquidation.
Is management's fault the previous management that actually we've built the company -- ran the company.
What they -- at fault for not being tough enough on the union's early enough you know they had gone into Chapter Eleven twice but they did not extract or exact enough concessions yeah I think that that if you go back and I don't spend a lot of time looking that far backwards.
Because there's not a lot of value -- for that but I would say in this case yes the concessions that were achieved in the first bankruptcy were not deep enough.
The assumptions that were probably used in terms what the business would generate in terms of sales and profitability were overly optimistic.
At that time around.
And so you know the company therefore ended up sort of especially track when the companies having to spend almost a hundred million dollars in a year on pension health cost for Teamsters who had never even worked for the company it it itself.
I think you're kind of work out -- and you go into disaster after that is that she went into -- -- after the scandal he went into New York off track betting when it was him in almost a bankruptcy new dissolve that.
Now posted this whole thing can be done by march April.
What do you hope -- -- time might be you get a parachute or don't you ever wanna make a commitment stick with one company and run it instead coming into crisis I think this is a kind of commitment -- -- maybe -- -- -- -- Longer term as you're talking about that's what I say when I go for days ahead exactly know I I've.
I think I don't know what's next its interest in being in the business I'm in the drawing a radar foresee can't really look -- ahead -- -- look at who's in trouble too much from their three months from now.
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