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Interstate Bakeries, Teamsters contract talks fail; Oct. 3 exclusivity extension hearing key to plans
By Caroline Salls
Pittsburgh, Oct. 1 - Interstate Bakeries Corp. said it has not been able to reach an agreement with the International Brotherhood of Teamsters on modifications to its collective bargaining agreements necessary to allow a more capable and cost-effective path to market, specific health and welfare concessions and increased work rule flexibility, according to a company news release.
Interstate said if agreements are not reached with its two principal labor unions by Sept. 30, it will seek interim bankruptcy court approval for a 30-day exclusivity extension to give the company enough time to formulate a plan that includes a sale of the company and/or its assets.
A hearing is scheduled for Oct. 3.
Company spokesman Maya Pogoda said the Oct. 3 hearing is a key event, at which point "we will have more information."
According to the release, Interstate is open to further "constructive discussions" with the Teamsters until the hearing.
The company also said that it is continuing discussions with prospective investors to secure funding required to successfully emerge from bankruptcy and implement its business plan but that all financing proposals the company has received to date require union alignment to Interstate's business plan.
If union and financing arrangements are not achieved by Oct. 3, Interstate said it will seek court approval of the exclusivity extension and focus efforts on alternative plans to maximize the value of its bankruptcy estates.
The Kansas City, Mo., bakery operator filed for bankruptcy on Sept. 22, 2004 in the U.S. Bankruptcy Court for the Western District of Missouri. Its Chapter 11 case number is 04-45814.
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