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Hostess going out of business amid union strike

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IRVING, Texas (AP) -- Hostess, the maker of Twinkies, Ding Dongs and Wonder Bread, is going out of business.

The company had said it would file a motion in U.S. Bankruptcy Court to shutter operations if enough workers don't return by 5 p.m. on Thursday. That would result in the loss of about 18,000 jobs.

Hostess, based in Irving, Texas, reached a contract agreement with its largest union, the International Brotherhood of Teamsters. But thousands of members in its second biggest union, the Bakery, Confectionery, Tobacco Workers and Grain Millers International Union, went on strike last week to protest cuts to wages and benefits under a new contract offer.

The privately held food maker filed for Chapter 11 protection in January.

The Texas-based firm said significant cost pressures had hindered its ability to compete, "primarily due to legacy pension and medical benefit obligations and restrictive work rules."

Hostess, which employs roughly 19,000 people, said its labor costs, combined with the economic downturn, had squeezed funding and prompted the decision to restructure.

The company emerged from bankruptcy in 2009, but the restructuring efforts at that time were insufficient, the company said.

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