Hostess options: Sell to Mexico’s Bimbo? Nationalize the Twinkie?

Ding Dong despair manifested itself in a myriad of ways over the weekend as Americans came to realize that Hostess Brands Inc. as they know it is likely no more.

A petition went up online asking President Obama to nationalize the Twinkie industry and “prevent our nation from losing her creamy center.” Organizers hope to gain 25,000 signatures by Dec. 16. So far, they have less than 3,500.

On Twitter, convenience store chain AMPM wrote “Farewell @Hostess_Snacks. Our heart is breaking. #LongLiveTheTwinkie!” Workers at Weber’s Bakery in Chicago said the business is considering making a Twinkie-like product called Winkies and selling them starting next year.

Recipes for homemade Twinkies began emerging online. The spongy cakes went up for sale on Craigslist and Ebay for thousands of dollars a box.

It was the kind of outpouring Hostess wished it had generated before throwing in the towel Friday. The company blamed a union walkout on its decision to close.

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But Hostess also suffered nine straight years of revenue declines, tumbling 30% to $2.45 billion last year from $3.53 billion in 2009, according to a report from research firm PrivCo. The company’s net losses nearly tripled to $341 million in 2010 from $128 million in 2006, according to the report.

Another factor in Hostess’ financial woes? Long-term debt totaling $591 million, causing a severe liquidity crunch, according to PrivCo.

But PrivCo estimates that Hostess brands such as Ho Ho’s and Wonder Bread could fetch $1 billion in an asset sale. The research group names Bimbo Group -- the Mexican company that owns Sara Lee and Entenmann’s -- and Nature’s Own parent Flowers Foods as potential suitors.

Neither Bimbo Group nor Flower Foods could be reached for comment.

Spokesman Lance Ignon confirmed that Hostess has “had interest from buyers for specific assets” but refused to name the interested parties.

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