First, Hostess has all the opportunity in the world to update their products to make them healthier and just as tasty. They haven't done that. Maybe they will do so with this reorg.
Second, the bankruptcy will allow them to renegotiate their contracts and benefits. "Additionally, Hostess employees are unionized while most of its competitors aren't. As a result, Hostess has high pension and medical benefit costs. The company has 19,000 employees and operates in 48 states."
Third, I kinda smell a bailout gift on the horizon: "The Teamsters Union, which represents about 7,500 of Hostess' delivery drivers and merchandisers, said in a statement on Wednesday that it is also committed to working toward a solution."
Last, it appears some good capitalists are keeping the company going: "The Irving, Texas-based company said that it will be able to maintain routine operations thanks to a $75 million financing commitment from a group of lenders led by Silver Point Capital LP."