Privately held Hostess Brands Inc. may file for Chapter 22 bankruptcy as early as this week according to a report in The Wall Street Journal. The company employs 19,000 people.
The WSJ reports that the maker of Hostess Twinkies, Zingers, and Cupcakes is carrying debt of around $856 million and has annual sales of about $2.5 billion. The company has arranged to receive about $75 million in debtor-in-possession financing to keep the company running during the bankruptcy proceedings.
The company also owes about $50 million to vendors, who have become more earnest in their attempts to collect. Hostess was hit by higher costs for sugar, flour, and other key ingredients when commodity prices spiked early last year.
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