Ailing US baker Interstate Bakeries Corp. (IBC) has been saved from liquidation, according to the Teamsters union.

The union said yesterday (20 August) it had "worked through the night" to secure a deal with investor Ripplewood Holdings and IBC's creditors.

Under the deal, the Twinkie bread maker will be able to emerge from four years of bankruptcy as a stand-alone company.

"After what looked like a drop off in negotiations, I'm pleased to announce that we were able to broker a settlement very late last night," said Richard Volpe, director of the Teamsters Bakery Workers Conference. "Our priority from the beginning was to help IBC find a plan that would preserve the best chance for the company's long-term viability."

Teamsters general president Jim Hoffa added: "This deal is important in IBC's recovery from bankruptcy as we work to protect our members' jobs."

The union said that details of the plan would be announced in the "next several weeks".

Officials at IBC could not be reached for immediate comment.