Biddeford sale sad postscript to I.B.C. debacle
June 24, 2014
The tale of Icarus, who ignored his father’s warnings and plunged to his death because he flew too close to the sun, came to mind amid news last week that Flowers Foods, Inc. has decided to sell rather than reopen the Biddeford, Maine, baking plant of Hostess Brands, Inc. The prospective sale (asking price $8.5 million, without equipment) offers still another reminder of how terribly wrong things went for Interstate Brands Corp. (renamed Hostess), prompting the company’s collapse.
For those who may not recall, Biddeford was among the newer I.B.C. plants, built in 1998 for a price of $65 million ($92 million in 2013 dollars). It was a mammoth state-of-the-art facility that raised eyebrows in the industry for its technological ambitiousness and the questionable desirability of the location. Company executives at the time celebrated the facility as evidence of Interstate's commitment to staying atop of the baking world. One executive promised Biddeford would be “the pride of the industry in the Northeast.” In anticipation of the new facility, plans were announced to close three older New England baking plants.
When construction was completed, serious production problems emerged immediately, and those, proving “more complex” than first thought, stretched from 1999 until well into 2000, when still deeper problems at the company began to emerge. While the company was reporting by 2001 the Biddeford plant was “performing as planned,” the episode already had come to symbolize a company where much was going amiss and whose sad future already had been cast.