AP: Mediation (ordered? UPDATE agreed to) in Twinkie fight

AP reports the fol­low­ing:

The bank­ruptcy judge hear­ing the case says that the par­ties haven’t gone through the crit­i­cal step of medi­a­tion and asked the lawyer for the bakery’s union to ask his client, who wasn’t present, if he would agree to participate

And there are inter­ested parties

Bimbo has already sniffed around the bank­ruptcy pro­ceed­ings that have haunted Host­ess for a decade, in a bid to fur­ther expand its North Amer­i­can port­fo­lio and pad its $4 bil­lion net worth. Bimbo report­edly put in a low-​ball bid of $580 mil­lion a few years ago, Forbes reports, and may be rewarded for that move since the Host­ess kit-​and-​kaboodle may fetch more like $135 mil­lion today.

But the big ques­tion is whether the same prob­lems that haunted Host­ess – high sugar prices tied to US trade tar­iffs, chang­ing con­sumer tastes, and union push­back against labor con­ces­sions – will squeeze what­ever profit is left in the brands.

Espe­cially if a Mex­i­can buyer is involved, pro­duc­tion may go the way of the Brach’s and Fan­nie May candy con­cerns: south of the bor­der. With US sugar tar­iffs set arti­fi­cially high to pro­tect Florida sugar-​growing con­cerns, a non-​unionized shop with access to lower-​priced sugar in Mex­ico could be the Twinkie life­line, econ­o­mists suggest.

but it’s not just a ques­tion of los­ing the tar­iffs it’s los­ing the unions:

First, this devel­op­ment has no small amount of irony. The labor move­ment has attacked Repub­li­cans for many long years for off-​shoring jobs in the name of free trade. Thanks to the bak­ers’ union, we may end up with almost 19,000 jobs head­ing south of the bor­der, in the fac­to­ries of Grupo Bimbo. The pro­tec­tion­ist sugar tar­iffs that both par­ties have extended and cham­pi­oned may end up hav­ing their own ironic role in these job losses, too.

Will Twinkies sur­vive? If we are to believe the unions then no, because it’s all about demon­strat­ing power at least that’s what they said.

Any­way I’ve bro­ken open a box of devil dogs but we’ll ration the Funny bones etc for now until we know for sure.

If it works out there are going to be a lot of peo­ple who spent a for­tune of Twinkies to put on eBay or peo­ple who have boxes on eBay who are going to feel like fools.

Update: No answer at the local Host­ess thrift shop, might be too late for them.

Update 2: Both side now have agreed to medi­a­tion, no word if that means the thrift store re-​opens but got some bar­gains Sat­ur­day.

Host­ess, its lenders and the Bak­ery, Con­fec­tionery, Tobacco Work­ers and Grain Millers Inter­na­tional Union (BCTGM), agreed to go into medi­a­tion at the urg­ing of Bank­ruptcy Judge Robert Drain of the South­ern Dis­trict of New York, who urged medi­a­tion rather than a more expen­sive, pub­lic hear­ing regard­ing the company’s liquidation.

“My desire to do this is prompted pri­mar­ily by the poten­tial loss of over 18,000 jobs as well as my belief that there is a pos­si­bil­ity to resolve this mat­ter,” Drain said.

Does the thrift shop return?

Update 3: The key words from the Host­ess web site

PRO­DUC­TION REMAINS SHUT DOWN.