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Flowers bid for Hostess inches closer


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The sign at the Hostess Brands Dolly Madison plant in Columbus was changed to ''closed'' Nov. 16, leaving more than 200 local employees out of work.
FILE PHOTO
The sign at the Hostess Brands Dolly Madison plant in Columbus was changed to ''closed'' Nov. 16, leaving more than 200 local employees out of work. FILE PHOTO


The closely watched sale of several dozen Hostess-owned manufacturing plants, its Wonder Bread label and other holdings to Flowers Foods Inc., of Thomasville, Ga., seems to be inching closer to reality.

No competing offers have surfaced in U.S. Bankruptcy Court in White Plains, N.Y., to vie with Flowers’ $360 million bid to acquire a big chunk of Hostess Inc.’s holdings. The Georgia company’s offer includes taking over the shuttered Dolly Madison plant in Columbus, which once employed 200 people making doughnuts, cakes and other sweets until Hostess shut down the operation more than three months ago.

Larry Duncan, business agent for Local 132 of the Bakery, Confectionery, Tobacco Workers and Grain Millers Union, believes Flowers may bring the facility back to life and resurrect jobs once it gains control in the complex bankruptcy proceedings.

“If Flowers gets the plant and opens that building back up, they’re bound to hire some of the former employees back who were in there,” said Duncan, who also worked at the plant.

What’s next?

No competing offers have surfaced in U.S. Bankruptcy Court in White Plains, N.Y., to vie with Flowers Foods Inc.’s $360 million bid to acquire a big chunk of the Hostess bread brands and manufacturing holdings.

That offer includes buying the shuttered Dolly Madison plant on National Road in Columbus.

If a competing bid had surfaced, an auction to pick a winner would have occurred today.

Now, the next step, will likely be a 10 a.m. court hearing March 19 in the bankruptcy court to review the Flowers’ bid and hear any objections from other parties.

Source: U.S. Bankruptcy Court, Southern District of New York

“There were mixer operators and (cake) wrapper operators in there with 20 years of experience, and it seems to me Flowers would be smart to call those people back,” said Duncan, who watched former co-workers scurry to find other jobs after the plant shut its doors Nov. 16.

If multiple bids had surfaced by now for the Hostess bread brands that Flowers covets, an auction to pick a winner would have been conducted today.

Now, the next step apparently will be a formal sales hearing at 10 a.m. March 19 in U.S. Bankruptcy Judge Robert Drain’s New York courtroom, where Flowers’ bid and any objections can be reviewed.

Opposition has surfaced to some aspects of the Flowers’ deal, including a bankruptcy filing by the Bakery, Confectionery, Tobacco Workers and Grain Millers International Union earlier this month. The union warned that Flowers hasn’t “committed to preserve a single job” in its purchase offer.

The union’s pension fund has a claim of $994 million pending in the Hostess bankruptcy proceedings.

“Flowers will not even commit to whether it intends to comply with federal labor laws, including recognizing the (Hostess) unions,” the international union said in its court filing. “The evaluation of bids should not be based solely on the dollars and cents that will be paid to secured creditors but should also consider how the bidder proposes to deal with the (Hostess) labor force.”

But Duncan said Wednesday that Flowers would be wise to use experienced workers to reopen the National Road plant.

“You can’t take a guy off the street or from some temporary employment agency and teach them how to make honey bun dough. An experienced worker would know that if the temperature is muggy, you cut some of the water out and add ice,” Duncan said, referring to baked goods tricks of the trade.

On Wednesday, though, Flowers’ plans for the Columbus plant — a small part of what it would buy from Hostess — remained unclear. Keith Hancock, a company spokesman, didn’t return a phone call seeking comment.

Meanwhile, another objection with a distinct Columbus flavor was filed Wednesday in the Hostess bankruptcy case.

It deals with a disagreement between the real estate partners who own FairOaks Mall and a Hostess subsidiary that ran the Dolly Madison plant on National Road.

A court statement from land surveyor Ted Darnall of Columbus says he did a survey for Fair­Oaks’ owners in January 2012 and found discrepancies in real estate records concerning which parcels of land the mall had deeded to Hostess’ Interstate Brands subsidiary in June 1992.

The problem is that a more recent real estate plat recorded on March 18, 2003, incorrectly shows Interstate Brands controlling more acreage than it actually does, Darnall said in his statement.

The statement goes on to say that the mall’s owners handed over only 0.2275 acres to Dolly Madison’s owners two decades ago, not four other small parcels that show up on the 2003 plat.

Darnall didn’t return a phone call or email Wednesday seeking clarification.

Flowers made its $360 million offer in mid-January, giving it status as the lead or “stalking horse” bidder for much of what Hostess owns. If the deal becomes final, Flowers would take over 38 depots and 20 manufacturing plants from Hostess nationwide.

Although Flowers is known primarily as a bread company, it also makes snack cakes, cream-filled treats, doughnuts and honey buns under the Blue Bird label. Some of those are distributed in Indiana.

Duncan said those products are similar to the assorted Dolly Madison cakes, doughnuts and other snack foods made in Columbus until late last year.

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