Hostess Brands Inc. is not going out of business just yet.
After a Monday bankruptcy hearing, the company and its baker's union will now go into mediation to try and resolve their differences. The company had moved to liquidate and sell off all assets in bankruptcy court Monday, citing a crippling strike by union workers last week.
Hostess management has agreed to go into mediation in an attempt to possibly avoid closing for good. The baker's union must agree to participate in the mediation.
are without jobs in northwest Ohio due Hostess' initial bankruptcy filing. Northwood Hostess workers voiced their concerns about the production shutdown late last week. "Pretty soon, I'm not going to be able to feed my kid. That's scary, it's very scary," said Melissa White, a nine year employee at the Northwood plant. Co-worker Mark Popovich, a 21-year veteran of the plant, echoed the same feelings. "I think we're all concerned. We're very concerned, what we would actually like is for them to renegotiate with us."
A strike initiated when workers in the baker's union rejected a contract from the company that would end pensions. Members say the contract they rejected would create an eight-percent wage reduction and cuts in benefits. The company countered by saying the strike would force them to lay off most of its 18,300-member workforce and sell off all assets.
If both sides cannot come to terms during the critical step of mediation, the case will move forward in U.S. Bankruptcy Court in the Southern District of New York in White Plains, N.Y.
(The Associated Press contributed to this article.)