Hostess Brands has failed to reach an agreement with its second-largest union.
On Wednesday, the company announced plans to wind down its business and sell assets have been approved by a U.S. bankruptcy court.
A judge approved the motion after 11 hours of mediation Tuesday.
Hostess Brands said it intends to retain approximately 3,200 employees to assist with the initial phase of the wind-down.
Employment is expected to decrease by 94 percent at Hostess Brands within the first 16 weeks.
The entire process is expected to be completed within one year.
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