US wholesale baker Interstate Bakeries has said it has filed for Chapter 11 bankruptcy protection.
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The company, whose brands include Wonder and Hostess, said it had filed a case under Chapter 11 of the US Bankruptcy Code in order to provide it with the necessary time to complete an operational and financial restructuring.
The company said that, subject to court approval, it has received a commitment for US$200m in debtor-in-possession financing from JPMorgan Chase Bank to fund operating expenses, and supplier and employee obligations. The company said that it would continue to operate its bakeries, outlet stores and distribution centres and deliver its products to retail outlets across the country.
Interstate Bakeries also announced that its board of directors has named turnaround experts Tony Alvarez as chief executive officer and John Suckow as chief restructuring officer.
In addition, director Leo Benatar was elected non-executive chairman of the company’s board of directors. James Elsesser, the company’s former chairman and CEO, resigned both positions effective today.
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By GlobalDataInterstate Bakeries cited liquidity issues, resulting from declining sales, a high fixed-cost structure, excess industry capacity, rising employee healthcare and pension costs and higher costs for ingredients and energy, as major factors in its decision to file.
