#twinkees

[mgmpluto]

Grease (1978)

“Hey! Sandy didn’t get any wine!”

[kirito-kuro-no-kenshi]

Silica: /petting Pina/ I wonder what Kirito's doing right now. I bet he spends all of his free time practicing with his swords! He's so cool! I wanna be awesome like him someday!

Kirito, elsewhere: I bet you fifty bucks I can eat thirty Twinkees without barfing!

Klein: You're on! Wait, this is Japan; shouldn't it be yen or something?

[sprinktripsy]

Tonight I eat like a Yank .

*ch omp*

It tastes like sugar (negativity).

[dickdime]

Weed Twinkees - POW! - #weed #marijuana #dope #Twinkees (at Conifer, Colorado)

[deniscollins]

How the Twinkie Made the Superrich Even Richer

A year after the layoffs at the Hostess plant in Illinois, Apollo and Metropoulos arranged for the company to borrow about $1.3 billion, and used most of that sum to pay themselves, and their investors, an early dividend on their investment. If you were a banker, would you establish limits on what percent of the borrowed money must be invested in the firm and what percent can be used for hedge fund manager salaries? If so, what percent? Why? What are the ethics underlying your decisions?

As fans gathered on Rockefeller Plaza in Manhattan, Al Roker pulled up in a big red delivery truck, ready to give America what it wanted: Twinkies.

The snack cakes flew through the air into the crowd pressed against metal barriers. One man shoved cream-filled treats into his mouth. Another “Today” host tucked Twinkies into the neckline of her dress.

Across the nation in the summer of 2013, there was a feeding frenzy for Twinkies. The iconic snack cake returned to shelves just months after Hostess had shuttered its bakeries and laid off thousands of workers. The return was billed on “Today” as “the sweetest comeback in the history of ever.”

Nowhere was it sweeter, perhaps, than at the investment firms Apollo Global Management and Metropoulos & Company, which spent $186 million in cash to buy some of Hostess’s snack cake bakeries and brands in early 2013.

Less than four years later, they sold the company in a deal that valued Hostess at $2.3 billion. Apollo and Metropoulos have now reaped a return totaling 13 times their original cash investment.

Behind the financial maneuvering at Hostess, an investigation by The New York Times found a blueprint for how private equity executives like those at Apollo have amassed some of the greatest fortunes of the modern era.

Deals like Hostess have helped make the men running the six largest publicly traded private equity firms collectively the highest-earning executives of any major American industry, according to a joint study that The Times conducted with Equilar, a board and executive data provider. The study covered thousands of publicly traded companies; privately held corporations do not report such data.

Stephen A. Schwarzman, a co-founder of Blackstone, took home the largest haul last year: nearly $800 million. He and other private equity executives receive more annually than the leaders of Facebook and Apple, companies that revolutionized the way society communicates.

The top executives at those six publicly traded private equity firms earned, on average, $211 million last year — which is about what Leon Black, a founder of Apollo, received. That amount was nearly 10 times what the average bank chief executive earned, though firms like Apollo face less public scrutiny on pay than banks do.

Private equity firms note that much of their top executives’ wealth stems from owning their own stock and that they have earned their fortunes bringing companies back to life by applying their operational and financial expertise. Hostess, a defunct snack brand that was quickly returned to profitability, is a textbook example of the success of this approach.

Yet even as private equity’s ability to generate huge profits is indisputable, the industry’s value to the work force and the broader economy is still a matter of debate. Hostess, which has bounced between multiple private equity owners over the last decade, shows how murky the jobs issue can be.

In 2012, the company filed for bankruptcy under the private equity firm Ripplewood Holdings. Months later, with Ripplewood having lost control and the company’s creditors in charge, Hostess was shut down and its workers sent home for good.

Without investment from Apollo and Metropoulos, Hostess brands and all those jobs might have vanished forever after the bankruptcy. The way these firms see it, they created a new company and new jobs with higher pay and generous bonuses.

But the new Hostess employs only 1,200 people, a fraction of the roughly 8,000 workers who lost their jobs at Hostess’s snack cake business during the 2012 bankruptcy.

And some Hostess employees who got their jobs back lost them again. Under Apollo and Metropoulos, Hostess shut down one of the plants they reopened in Illinois, costing 415 jobs.

The collapse and revival of Hostess illustrates how even in a business success, many workers don’t share in the gains. The episode also provides a snapshot of the economic forces that helped propel Donald J. Trump to the White House.

Since losing his job at Hostess in 2012, Mark Popovich has had three jobs, including one that paid about $10 an hour, half what he made at the Twinkie-maker. A lifelong Democrat and devoted “union man,” Mr. Popovich said he supported Mr. Trump, the first time he ever voted Republican.

“It’s getting old, getting bounced around all the time,” said Mr. Popovich, a 58-year-old Ohio resident.

Such frustrations stem from broader shifts in the economy, as all types of companies turn to automation to cut costs and labor unions lose their influence. While these changes have helped keep companies profitable, private equity has used these shifts in the workplace to supercharge wealth far beyond that of the typical chief executive.

And yet, Mr. Trump did not focus on private equity on the campaign trail, instead blaming the plight of the American working class on a shadowy cabal of elitist Democrats and Wall Street bankers who support trade deals that ship jobs overseas.

“People understand jobs going to China,” said Michael Hillard, an economics professor at the University of Southern Maine. “But no one has ever heard of these private equity firms that come in and do all this financial engineering. It is much more complicated and less visible.”

The industry’s trade group, the American Investment Council, says it is sensitive to these issues as private equity’s role in the economy expands. The industry now controls huge swaths of the American work force: 4.4 million employees at over 7,500 companies, according to PitchBook, a private financial data platform. By some measures, Blackstone is one of the nation’s 10 largest employers and one of its biggest landlords. The firm’s co-founder, Mr. Schwarzman, is advising Mr. Trump on job creation.

“At a time when many Americans are concerned about the country’s economic viability, private equity has proven itself in communities throughout the United States as an effective solution,” said James Maloney, the American Investment Council’s spokesman. “Sustainable growth strategies, adherence to responsible investments and a long-view approach are all a part of the present-day private equity model.”

The Times investigation of the Hostess deal shows that today’s private equity also uses another set of tactics, like special dividends and tax arrangements, that maximize profits in creative, yet financially risky ways.

A year after the layoffs at the Hostess plant in Illinois, Apollo and Metropoulos arranged for the company to borrow about $1.3 billion. Apollo and Metropoulos used most of that sum to pay themselves, and their investors, an early dividend on their investment.

The firms also found a way to make money even after the company was sold. The firms, The Times investigation found, struck a deal to collect as much as $400 million over the next 15 years, based on what Hostess’s future tax savings might be.

These winnings do not come without risk to the private equity firms, which are often taking a gamble on troubled companies, and when they fail, the firms probably lose out.

And this is not a simple story of powerful investors enriching themselves while some workers struggle. Teachers and firefighters also benefit from private equity.

Pension funds that pay retirement benefits to public servants now depend on private equity to generate huge returns. Without it, taxpayers could bear more of the costs.

“Hostess’s comeback was a win-win-win-win,” an Apollo spokesman said in a statement, adding that its investment benefited workers, communities, investors and consumers. “After teaming up to take on the daunting financial and operational challenge of creating a new company around the Hostess brand, Apollo and Metropoulos & Co. completed a highly successful private equity investment.”

On a more basic level, Americans enjoy what private equity has owned: GNC vitamins, affordable jewelry at Zales, and birthday parties at Chuck E. Cheese’s.

VERY LONG ARTICLE CONTINUES ...

[moodyspookyqueen]

on my way to steal yo girl

[klappersacks]

Superman Twinkee Ad 1976 by Drive-In Mike on Flickr.