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KANSAS CITY, Mo. -- Could low-carb diets possibly have done in Twinkies?
Interstate Bakeries Corp., the nation's largest wholesale baker and producer of such iconic products as Twinkies and Wonder Bread, filed for Chapter 11 bankruptcy protection yesterday. It also named a new chief executive.
The electronic filing, made shortly after midnight with the U.S. Bankruptcy Court for the Western District of Missouri in Kansas City, listed assets of $1.626 billion and liabilities of $1.321 billion.
Interstate blames its dismal performance on decreased demand for bread and pastries due to the popularity of low-carbohydrate diets. The company said it had a commitment, subject to bankruptcy court approval, from JP Morgan Chase Bank to provide $200 million to pay suppliers, employees, and other operating costs during the reorganization, during which time it would continue operating its bakeries, outlet stores and distribution centers.
James R. Elsesser, who had been chairman and c.e.o., resigned both positions effective Wednesday, and the board named Tony Alvarez as c.e.o. and John Suckow to chief restructuring officer. Both are with Alvarez & Marsal, a turnaround management firm founded and headed by Alvarez.