Kansas City, Nov. 5 - Bankrupt Interstate Bakeries Corp, the maker of Wonder Bread and Twinkies, Monday filed a reorganization plan that could stymie a takeover attempt by an outside investment firm and Mexican baker.
Interstate Bakeries (IBC) said late Monday it had filed a reorganization plan with the U.S. Bankruptcy Court for the Western District of Missouri with the support from lenders representing about 95 percent of the company's pre-petition senior secured credit facility.
IBC said because it has now filed its long-awaited reorganization plan, third parties "may not file, absent further court order, a plan of reorganization prior to January 7, 2008." IBC has until that date to solicit acceptances of the reorganization plan.
"The company believes that the reorganization plan it has filed today provides substantial value to its creditors," IBC CEO Craig Jung said in a statement.
The filing comes three days after Los Angeles-based investment fund Yucaipa Cos and the U.S. arm of Mexico-based Grupo Bimbo told the court they wanted to begin due diligence to make an offer to take over Kansas City-based IBC.
Representatives from Yucaipa and Bimbo could not be reached for comment.
Yucaipa, which is controlled by billionaire Ron Burkle, and Bimbo Bakeries USA have the support of the International Brotherhood of Teamsters, which represents about 10,000 IBC workers. The Teamsters have steadfastly refused to agree to concessions sought by IBC, which IBC has said are required if it is to receive the funding it needs to exit bankruptcy.
Yucaipa has thus far been prevented from getting a look inside Interstate Bakeries because it has refused to sign a confidentiality agreement that could limit its discussions with the union.
IBC's Jung said Monday that "all potential investors" were invited to come forward with alternative proposals," subject to appropriate confidentiality restrictions. IBC spokeswoman Maya Pogoda said IBC was now willing to make the confidentiality agreements less restrictive, to include allowing discussions with the unions.
"If Yucaipa or anyone else has a better idea about how to help this company emerge from Chapter 11, secure jobs, and maximize value for creditors, we welcome the opportunity to review the details of their proposal," said Jung.
IBC, one of the nation's largest commercial bakers and distributors of fresh-baked bread and sweet goods, said a cornerstone of its reorganization plan is a previously announced commitment by Silver Point Finance, LLC, to provide up to $400 million in exit financing upon IBC's emergence from Chapter 11.
IBC also has obtained funding agreements to support the reorganization plan from a group of lenders led by JP Morgan Chase Bank, N.A.
The company filed for bankruptcy protection in September 2004, citing liquidity issues, rising employee healthcare and pension costs, and higher costs for ingredients and energy.