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Hostess In Current Condition Because Of Failed Management

          Hostess In Current Condition Because Of Failed Management

PR Newswire

KENSINGTON, Md., Nov. 15, 2012

KENSINGTON, Md., Nov. 15, 2012 /PRNewswire-USNewswire/ -- The following
statement was issued by BCTGM International Union President Frank Hurt in
response to claims by Hostess Brands that it would begin liquidation should
union members not end the strike and return immediately to production
facilities:

"The crisis facing Hostess Brands is the result of nearly a decade of
financial and operational mismanagement that resulted in two bankruptcies,
mountains of debt, declining sales and lost market share. The Wall Street
investors who took over the company after the last bankruptcy attempted to
resolve the mess by attacking the company's most valuable asset – its workers.

"They sought to force the workers, who had already taken significant wage and
benefit cuts, to absorb even greater cuts including the loss of their pension
contributions. I have said consistently throughout this process that the BCTGM
is a highly democratic organization and that our Hostess members themselves
would determine their future. By an overwhelming majority, 92 percent, these
workers rejected the company's outrageous proposal, fully aware of the
potential consequences.

"Our members know that the plans all along of the Wall Street investors
currently in control of this company did not include the operation of Hostess
Brands any longer than it takes to sell the company in whole – or in part – in
a way that will maximize the profits of these vulture capitalists regardless
of the impact on the workforce.

"The wholesale bread and cake baking business is unique. The most successful
and profitable wholesale baking companies share common attributes, most
notably being executive leadership with extensive background in the business
and a skilled and dedicated workforce. Hostess Brands and its predecessor
companies have had the latter for decades.

"Unfortunately however, for the past eight years management of the company has
been in the hands of Wall Street investors, 'restructuring experts,'
third-tier managers from other non-baking food companies and currently a
'liquidation specialist.' Six CEOs in eight years, none of whom with any
bread and cake baking industry experience, was the prescription for failure.

"Despite Greg Rayburn's insulting and disingenuous statements of the last
several months, the truth is that Hostess workers and their Union have
absolutely no responsibility for the failure of this company. That
responsibility rests squarely on the shoulders of the company's decision
makers.

"I am sure that our members would be agreeable to return to work as soon as
the company rescinds the implementation of the horrendous wage and benefit
reductions, including pension, and the restoration of the cuts that have
already taken place."

BACKGROUND

A total of 24 Hostess production facilities are on strike or honoring the
strike with picket lines established by striking Hostess workers at other
BCTGM-represented facilities. Additionally, BCTGM members at one transport
facility also are on strike. Company claims that union members are crossing
picket lines and maintaining production at striking plants are vastly untrue.

Over the past 15 months, Hostess workers have seen the company unilaterally
end contractually-obligated payments to their pension plan. These workers,
many of whom have worked at Hostess and its predecessor companies for decades,
struck in response to the company's unilateral imposition of an unacceptable
contract that was rejected by 92 percent of the union's Hostess members in
September.

While the company was demanding major concessions from union workers (wage and
benefit cuts amounting to 27- 32% overall), the top ten executives of the
company rewarded themselves with compensation increases, with one executive
receiving a 300 percent increase.

The BCTGM represents more than 80,000 workers in the baking, food processing,
grain milling and tobacco industries in the United States and Canada.

Follow the BCTGM:
Web: www.bctgm.org
Facebook: http://facebook.com/BCTGM
Twitter: http://twitter.com/BCTGM

Contact: Frank Hurt, BCTGM International President
(301) 933-8600

SOURCE Bakery, Confectionery, Tobacco Workers and Grain Millers International
Union

Website: http://www.bctgm.org
 
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