November 2, 2007

(Washington, D.C.) – The Teamsters today announced a plan with Yucaipa Companies and Bimbo Bakeries USA (BBU) to purchase Interstate Bakeries Corp. (IBC) and save tens of thousands of jobs at the bankrupt company. The partnership brings together the financing of Yucaipa and its expertise in working with unionized companies, the operating prowess of one of the largest baking companies in the world, BBU, and the Teamsters Union as the key component of the distribution system.

“A key ingredient of our plan will be a commitment from Ron Burkle and the Yucaipa Companies and Bimbo Bakeries to value the sacrifices of our members and position the company for long-term growth,” said Jim Hoffa, Teamsters General President. “Under IBC’s plan, our members were being asked to make the largest sacrifice, putting their faith in an untested delivery system in an entity that had little room for error. It was a recipe for another bankruptcy.” 

The plan by the Teamsters, Yucaipa and Bimbo Bakeries includes investing in IBC operations and marketing while maximizing opportunities for IBC employees with respect to job security, wages and benefits. 

IBC’s management is recommending a plan backed by Silver Point Finance which would leave the company highly leveraged and Teamster-represented route sales and transport workers shouldering the largest part of financial cuts.

“Our plan is in direct contrast to IBC’s proposed financing plan with Silver Point,” said Richard Volpe, Director of the Teamsters Bakery and Laundry Conference. “We have low expectations in IBC’s plan to sustain the company for any length of time. Our main goal was to find an investor and a management team that would honor our sacrifices, deal with us with respect, and create a viable business that provides ongoing goods and services to its creditors and vendors. We believe this plan achieves those goals by preserving jobs, health care and pension benefits for our members as well as a better rationalization of labor relations. 

“This plan calls for our members to make sacrifices, which is never easy, but given our alternatives this is a home run,” Volpe said. The current product synergies, commitment for new product development and national distribution network will give our members the best chance to protect their earnings, health care and retirement. Not only do I feel confident about this plan but Teamster Bakery leaders from around the country unanimously endorsed this as the way to go forward.”

The Teamsters filed a pleading today opposing IBC’s extension of exclusivity and IBC’s motion to enter into the exit financing with Silver Point. Yucaipa filed a similar pleading.

Bimbo Bakeries USA has extensive experience managing the production and distribution of baked goods. Founded in the early 1940s, the Fort Worth, Texas-based company produces such brands as Oroweat and Entenmann’s. Yucaipa Companies is a premier investment management firm that has established a record of fostering economic value through the growth and responsible development of companies, working to preserve union jobs and supporting working families nationwide. Earlier this year, the Teamsters endorsed a Yucaipa plan to finance and reorganize another Teamster employer, Allied Holdings, which, like IBC, was having financial difficulty.

More than 9,500 IBC employees are represented by the Teamsters Union. Founded in 1903, the International Brotherhood of Teamsters represents 1.4 million hardworking men and women throughout the United States, Canada and Puerto Rico.